African financiers eye surge of IPOs and M&A as Dangote refinery plans $5 billion listing

Bankers in Africa are betting that the continent’s equity markets are entering a more active phase, with Aliko Dangote’s anticipated $5 billion refinery IPO on the Nigerian Exchange at the forefront. Yemisi Deji-Bejide of Standard Chartered views the offering as proof of Africa’s growing capacity to build and fund large-scale industrial projects after a period of sluggishness. Citigroup’s Miguel Azevedo notes that strong demand from both retail and institutional investors could expand capital availability for other firms.

Recent M&A moves, such as Diageo’s $2.3 billion sale of its East African beer arm to Japan’s Asahi and Nedbank’s $855 million proposal for a controlling stake in Kenya’s NCBA Group, reflect a more favourable economic backdrop and a window for private-equity exits. However, analysts caution that the market remains fragmented and that a single large transaction alone cannot create deep, liquid markets. Success of the Dangote listing could encourage more African companies to go public and prompt exchanges to facilitate cross-border investing.