How The Dangote Group Will Become A $100bn Business
Passionate about the emerging markets of Africa and many other aspects of the global economy.
With a track record exhibiting profound resilience and foresight, it comes as no surprise that Dangote Group and its founder and CEO, Aliko Dangote, are ardent on building the multinational conglomerate into a $100bn (market capitalisation) business.
A Growing Business
Established in May 1981, such goals may not always have seemed possible from the outside looking in. Dangote Group started as a trading business with an initial focus on cement. With time, the group diversified, trading in cement, sugar, flour, and fish. Today, Dangote Group is one of the largest manufacturing conglomerates in sub-Saharan Africa with subsidiaries in Benin, Cameroon, Ghana, Nigeria, South Africa, and Zambia.
In 2016, it partnered with First Exploration and Petroleum Development Company (First E&P) to acquire Twister, a Dutch engineering company which Aliko Dangote believes to possess cutting edge technology that will unlock three billion cubic feet per day of gas.
Dangote Group’s two gas pipelines will span 550 kilometres, playing a significant role in helping Nigeria increase its supply of electricity. More recently, Dangote and China’s heavy duty truck group, Sinotruk partnered to set up a $100m plant for the assembly of 16 trucks a day which will be exported to West African neighbours.
Expanding into Other Fields
What may be a more pressing development to some is the launch of the $17bn oil refinery plant which will produce 650,000 barrels of oil per day. The group is committed to ensuring that its petrochemical and fertiliser plant in Nigeria will not only be useful for the nation but its neighbours too.
Nigeria’s neighbours are likely to benefit from the plant significantly as they will be able to import goods at a cheaper rate. The group’s plants are expected to produce 1.3 million tonnes of polypropylene and polyethene a year.
These developments may aid not only Nigerians but Dangote in overcoming risks tied to its recent foreign reserve challenges. Speaking on risks tied to foreign exchange, Aliko Dangote stated:
“Business is always ups and downs. We are in Africa for the long-term, not only in Nigeria. If you are in Africa or in Nigeria for [the] short-term, then you shouldn’t be there. We are there for [the] long-term and I believe that we will get out of [the] woods very soon.” tweet
He added: “If you are in Africa or in Nigeria for the short-term, then you shouldn’t be there.”
The Nigerian government is very supportive of Dangote Group’s projects which are expected to produce 235,000 jobs upon completion for the state and Income for the federal government which will be in the region of over $500m. Vice President, Yemi Osinbanjo and Lagos state Governor, Akinwumi Ambode shared similar sentiments.
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