The Dangote Refinery plans to sell a 12.7% stake in 2024 to help pay off loans, according to a report by Fitch Ratings. Previously, the Nigerian National Petroleum Company Limited (NNPC) intended to buy a 20% stake in the refinery. However, as of June 2024, NNPC chose not to acquire the additional 12.75%, which could affect the group's ability to manage its loans.
In 2021, NNPC purchased a 7.25% stake in the refinery for $1 billion, with an option to buy the remaining 12.75% by June 2024. NNPC has since decided against this additional purchase. Fitch noted that because NNPC did not exercise this option, the Dangote Group now plans to sell the 12.75% stake in 2024 to service a large syndicated loan due in August 2024. Fitch expressed concerns about the timely sale of this stake and meeting the loan deadline.
READ ALSO: UK Prepares for More Riots with Thousands of Police on Standby
In July, Alhaji Aliko Dangote, President of the Dangote Group, clarified that NNPC only holds a 7.2% stake in the refinery, not the 20% many believed. He explained that although there was an agreement for NNPC to buy 20%, they did not complete the payment, leaving their stake at 7.2%. NNPC confirmed this, stating they decided not to further invest in the refinery.
NNPC's spokesperson, Olufemi Soneye, mentioned that the company regularly reviews its investments to ensure they align with strategic goals. They decided to limit their investment in the Dangote Refinery to the amount already paid and communicated this to the refinery months ago.
Former Minister of Education, Oby Ezekwesili, has called for an independent audit to investigate why NNPC limited its investment to 7.2% instead of the planned 20%. She questioned whether the Nigerian government borrowed $3.3 billion from Afriexim-Bank to invest in the refinery and urged President Bola Tinubu to launch an audit to provide the public with accurate information about the transaction between Dangote Refinery and NNPC.
0 Comments