The National Pension Commission (PenCom) has granted Pension Fund Administrators (PFAs) regulatory forbearance to invest in the planned $50 billion Initial Public Offering (IPO) of Dangote Petroleum Refinery & Petrochemicals FZE.
The approval provides a special dispensation allowing pension operators to participate in what is expected to become one of Africa’s largest public offerings.
According to PenCom, the decision followed a detailed review of requests seeking permission to invest pension fund assets in the proposed listing.
Dangote Refinery Targets Landmark $50 Billion Valuation
The Dangote Petroleum Refinery is preparing to float about 10 percent equity of its operations to the public in a deal expected to value the refinery at up to $50 billion.
The refinery, located in Lagos with a capacity of 650,000 barrels per day, is already regarded as one of Africa’s most significant industrial assets.
The IPO is also expected to include dollar-denominated dividends, making it attractive to institutional investors, including pension funds.
PenCom Cites Economic Importance and Strong Fundamentals
In its circular to PFAs, PenCom said the refinery’s strategic importance to Nigeria’s economy and its strong growth prospects influenced its decision.
The regulator also referenced the track record of Dangote Industries Limited as a key factor in granting the approval.
PenCom noted that the investment could generate broad economic benefits, particularly in energy security, industrial growth and capital market development.
Regulatory Waiver Comes With Strict Conditions
The circular, signed by A.M. Saleem, Director of the Surveillance Department, stated that PFAs may proceed under a special dispensation from Section 6.2.7.1 (iii) of the investment regulation framework.
This waiver temporarily removes certain restrictions, including profitability and dividend history requirements, but maintains all other regulatory safeguards.
However, PenCom stressed that PFAs must still comply with internal risk management rules and fiduciary responsibilities to pension contributors.
Waiver Described as Exceptional and Non-Precedent Setting
PenCom emphasized that the approval is strictly case-specific and applies only to the Dangote Refinery IPO.
“The regulatory forbearance granted under this Circular is exceptional, one-off, and strictly case-specific,” the commission stated.
It added that the decision should not be interpreted as a precedent for future IPOs or investment transactions.
The circular took immediate effect, with PFAs directed to seek clarification from the Surveillance Department where necessary.
