The Dangote Group is considering selling a 12.5% stake in its newly commissioned refinery due to liquidity challenges, according to Fitch Ratings.
This follows Nigerian National Petroleum Corporation’s (NNPC) earlier acquisition of a 7.25% stake in 2021 and an option to buy an additional 12.75% by June 2024.
Fitch Ratings highlights that Dangote’s ability to meet its syndicated loan obligations, due in August 2024, is uncertain.
The refinery, currently operating at 50% capacity, has not yet met expected EBITDA contributions, partly due to production ramp-up issues and inadequate gas supply affecting its fertiliser business.
Dangote has already repaid $2.4 billion of the $5.5 billion loan used for the refinery project. However, the remaining debt and ongoing financial pressures raise concerns about potential financial restructuring or default.
(Business Day)