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Sonangol reveals details of IPO plan

Sonangol, the national oil company (NOC) of Angola, has revealed details of its plan to issue an initial public offering (IPO) of stock.

According to Sebastião Gaspar Martins, Sonangol’s chairman, the government-owned company is gearing up to sell 30% of its equity in the IPO. The stock will be listed in multiple locations, starting with the Angola Debt and Stock Exchange in Luanda and expanding later into foreign venues, he said during an address at the Angola Oil & Gas 2021 conference.

“We are analysing several different stock markets, starting with Luanda, but in a second phase also London and Wall Street,” Martins was quoted as saying by Angolan press agencies. “Luanda will certainly come first.”

The sale could generate as much as $5-7bn in budget revenues, he added.

The Sonangol chairman did not say exactly when the Angolan government expected to proceed with the IPO. However, he told the Lusa news agency on the sidelines of the conference that Luanda might need as much as three or four years to prepare. Since Angola’s government wants the stock issue to succeed, it is willing to move slowly so that it can resolve questions relating to Sonangol’s former status as concessionaire of the country’s hydrocarbon resources, he explained.

The NOC has not acted as concessionaire since June 2019. At that time, the government reassigned that function to a newly created state body, the National Oil, Gas and Biofuels Agency (ANPG).

Martins also explained last week that the upcoming IPO was designed to support the NOC’s ongoing restructuring effort. This programme “prioritises financial stability,” he said during his speech at the conference, and is designed to allow Sonangol to focus on its core activities – namely, the exploration, production, transportation, distribution, processing and sale of crude oil and natural gas, as well as their derivatives. As such, it will include divestment, in the form of “changes to the core business, a financial and portfolio restructuring, regulatory structures and an organisational support axis,” he explained.