Dangote Refinery IPO and Matters Arising -By Edwin Uhara

I have studied most of the advert materials concerning the Dangote Petroleum Refinery Initial Public Offering and I have discovered that most of the message focused more on getting investors to buy the company’s shares without disclosing some relevant information that will guide and forearm investors before making their investment decisions.

Of cause, Dangote is a big brand and anybody investigating in the company is bound to be reaping dividends every year but the Nigerian capital market operates on some rules which must be observed irrespective of how much money you want to invest.

As a result, the era of issuing share certificate to investors is gone because the practice has been replaced with the Central Securities Clearing System Number known as CSCS Account.

However, CSCS account is an electronic depository account managed by the Central Securities Clearing System which maintains shares, bonds and other financial securities in digital form within the Nigerian capital market.

In other words, your CSCS Account is where any number of shares you buy from the Dangote Petroleum Refinery IPO would be lodged.

The reason for the CSCS Account is because it serves as a legal proof that you own a specific number of stocks or securities and it also makes it easier for you to convert it into cash through the stock market each time you need urgent cash.

So before you even think of buying the company’s share, you must have your CSCS Account which only a licensed stock broker recognized by the Security and Exchange Commission can offer you.

Similarly, you must also have the Clearing House Number (CHN) This Clearing House Number is a unique or permanent identification number assigned to you as an investor. It functions much like the BVN in the banking sector.

Some investors now describe the CHN as the BVN for the stock market because it identifies you as an individual investor across the entire Nigerian financial system.

Also, investors must ensure that their mandate bank which is the bank account number they are filling on the form is accurate and reliable because if anything affects the mandate bank number, it will be very difficult for such investor to receive his or her dividends, bonus or any benefits the company may decide to offer it’s shareholders.

If you make mistake with the mandate bank account, the dividend that is supposed to come to you as an investor will now be classified as unclaimed dividend.

Billions of Naira are trapped under this unclaimed dividend stuff because of issues emanating from investors mandate bank account problem.

For instance, if you use Unity Bank as your mandate bank and refused to rectify the new reality of the bank as ProvidusUnity Bank with your broker and the company’s registrar, the dividend that is due for you will not come but will be classified as unclaimed dividend because no means of payment.

Once it is declared as unclaimed dividend, the Federal Government based on the recent directive given by President Bola Tinubu will now claim this money and channel them into funding the Nigerian Education Loan Fund (NELFUND).

Nonetheless, I understand that virtually all the banks are encouraging their customers to make transfer from their account in order to purchase Dangote Petroleum Refinery shares but before you make that transfer, kindly enjoy that you have opened a CSCS Account with a registered stock broker.

Also, try as much as possible to identify with the company’s registrar so that you will be promptly informed on anything concerning the company’s shares, annual general meeting, bonuses etc.

So without the intention of running advert for the registrar for Dangote Petroleum Refinery but with the mindset of rendering selfless service so that Nigerians can follow up with their investment, the registrar for Dangote Refinery is Coronation Registrars Limited.

The company is the one that maintain the official register of shareholders, manage share transfers, allotments and verification processes for the public offer.

I think these few tips will guide Nigerians and foreign investors wishing to invest in Nigeria in their investment plans.

I thank you all!

Comrade Edwin Uhara is a United Nations-trained Negotiator and Public Policy Analyst