(NAIROBI, KENYA) – Kenyan investors will need at least KES 107,000 ($828 / GBP 624) to buy shares in Nigeria’s Dangote Petroleum Refinery initial public offering through a financial instrument listed on the Nairobi Securities Exchange.
The higher minimum is set to lock out a significant share of retail investors from the Lagos based refinery IPO, which is being sold to local investors via an instrument known as global depository receipts.
Global depository receipts are bank certificates that represent ownership of a specific number of shares in a foreign company, allowing investors to trade on stock exchanges outside the issuer’s home market.
Under the receipts, which will represent the underlying Dangote shares being listed on the Nigerian Stock Exchange, Kenyan investors can buy them at KES 53.50 ($0.41 / GBP 0.31) apiece and trade the certificates at the Nairobi bourse.
The Capital Markets Authority approved receipts programme has set the minimum number of units to be purchased by investors at 2,000, with each selling for KES 53.50 ($0.41 / GBP 0.31), rounding off to a KES 107,000 ($828 / GBP 624) minimum.
Disclosure of the high minimum floor has failed to match the IPO’s primary offering in Nigeria, where investors can buy a minimum of 10 shares for KES 49.25 ($0.38 / GBP 0.29) each or 525 Naira, or a total of KES 492.50 ($3.81 / GBP 2.87).
“The programme requires a minimum investment of 2,000 global depository receipts, with additional subscriptions available in multiples of 100 receipts and no upper limit,” said Renaissance Capital.
“Official listing on the Nairobi Securities Exchange is targeted for 8th December 2026.”
Renaissance Capital, which is the sponsoring broker of the receipts, did not immediately respond to queries on the high minimum threshold for investing in the shares sale.
The receipts programme had initially been expected to match the Dangote IPO in Nigeria, where the minimum investment threshold would have been set at just under KES 500 ($3.87 / GBP 2.92), representing the purchase of 10 shares for KES 49.25 ($0.38 / GBP 0.29) each.
“We would like everybody to participate in the IPO, which means using the issued information memorandum which allows for the purchase of a minimum of 10 shares,” said Stanley Kariuki, chief executive officer of Renaissance Capital Kenya, previously.
“We have seen interest across the board from both retail and institutional investors.”
The Dangote IPO, which is Africa’s biggest ever, was approved and issued in Lagos, and could not be marketed and sold in Kenya without the Capital Markets Authority nod.
National Bank of Kenya, Sterling Capital, Kestrel Capital and AXYS Investment Bank are facilitating access to the Dangote IPO through partner relationships in Nigeria.
Stanbic Bank is expected to serve as the custodian in the receipts deal, directly purchasing the Dangote shares, which will then be packaged into receipts and offered to local investors who can then trade the units at the Nairobi Securities Exchange.
The IPO, which seeks to raise KES 207.5 billion ($1.6 billion / GBP 1.21 billion), runs up to 13th October.
The sale is offering 4.1 billion ordinary shares, equivalent to a 3.4% shareholding of the Dangote Petroleum Refinery.
The capital markets regulator gave its approval to the receipts offering on Monday after delays over undisclosed pending issues.
The offering of the receipts to Kenyan investors is expected to run alongside the Dangote IPO in Nigeria, which closes on 13th October.
The listing of the receipts on the Nairobi bourse remains subject to the obtaining of relevant approvals from Nigeria’s Securities and Exchange Commission.
Investors in the offer will be allotted units or receipts on 11th November, while the transfer of proceeds and crediting of the units in the investors’ Central Depository and Settlement Corporation accounts is set to happen between 12th November and 2nd December.
Kenyan investors will be able to trade and settle receipts in Kenyan Shillings through the existing capital market infrastructure, while the underlying ordinary shares will remain in custody on the Nigerian Exchange on a 1:1 ratio.
Renaissance Capital sees the receipts as the most optimal route to give Kenyan investors access to the Dangote IPO.
“What we aim to do is give investors in Kenya a way to participate in the Dangote IPO through a market and infrastructure they already know, trading on the Nairobi Securities Exchange and settling in Kenyan shillings, without separate arrangements in Nigeria,” the investment bank said.
Stanbic Bank Kenya is acting as the custodian in the transaction, supporting the secure holding of the underlying Nigerian shares and the link between the securities and the receipts traded in Kenya through the Nairobi Securities Exchange.
The receipts offering is the first in the Kenyan market since the creation of a depositary receipt framework by the Capital Markets Authority in 2017.
The framework facilitates local investors to reach opportunities in other markets without leaving the protection of the regulated market.
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