Dangote Group

Last updated
Dangote
Type Private
Industry Conglomerate
Construction Materials
Founded1981;42 years ago (1981)
Founder Aliko Dangote
Headquarters Lagos, Lagos State, Nigeria
Key people
 Aliko Dangote
(President & CEO)
Products
RevenueIncrease2.svg US$4.1 billion (2017) [1]
Number of employees
30,000
Website dangote.com

The Dangote Group is a Nigerian multinational industrial conglomerate, founded by Aliko Dangote. [2] It is the largest conglomerate in West Africa and one of the largest on the African continent. The group employs more than 30,000 people, generating revenue in excess of US$4.1 billion in 2017. [2]

Contents

History

The company was founded in 1981 as a trading enterprise, importing sugar, cement, rice, fisheries, and other consumer goods for distribution in the Nigeria market. [3] The group moved into manufacturing in the 1990s, starting with textiles, moving onto flour milling, salt processing and sugar refining by the end of the decade. The company next moved into cement production, growing rapidly and moving into other African countries. A high degree of vertical integration is a hallmark of Dangote Group's operating strategy.[ citation needed ]

The group now owns and operates over 18 subsidiaries, operating in ten African countries. Dangote Cement, is one of these subsidiaries that is listed on the Nigerian Stock Exchange, with its market capitalization accounting for almost 20 percent of the total capitalization of the Nigerian Stock Exchange. [4] Dangote Group is headquartered in Lagos.

In 2016, Dangote signed a contract with CNOOC Group for the installation of a large underwater offshore pipeline. The pipeline, when completed, will extend from Bonny (Rivers State) through Ogedegbe, Olokola to Lekki and the Escravos Lagos pipeline, finally terminating at the West Africa Gas Pipeline. [5]

Overview

Dangote Group was created in the late 1970s, when Aliko Dangote established a venture that traded sugar and other consumer goods, which was funded by a $3,000 loan from his grandfather. [2] Later, the group would gradually expand into trading other commodities, such as rice. [6] In 1981, he established two business enterprises, Dangote Nigeria Limited, and Blue Star Services, this was a period when import licenses were required to import bulk commodities, the firm then sought to acquire import licenses for various commodities including steel, baby food, and aluminium products. [6] He then added the shipping and the importing of cement to his group's portfolio. [2] Dangote competed (and competes) with Lafarge, a French company that imported and produced the bulk of African cement. [7]

When the import license era was discontinued in 1986, the firm concentrated in bulk importing of salt, sugar, and rice and gradually reduced its cement business. [6]

Manufacturing

The group's first foray into manufacturing began in 1989 with textiles Mills Limited, operating two operations, a textile weaving mill in Kano and the Nigerian Textile Mills limited's plant in Lagos. [8] Beginning in 1997, following a decline of the textile sector, the company concentrated on manufacturing consumer goods it was importing into Nigeria such as sugar refining and flour milling, with the former it competed against imported products from Brazil and Europe. [6] One of the biggest distributors of sugar in Nigeria, Dangote sugar refinery began local production in 1999. [8] The strategy towards backward integration led to the establishment of a pasta plant and also flour milling to supply raw materials for making pasta. [8] The company then invested in a cement manufacturing venture at Obajana, Kogi State, with an aggressive strategy, the Obajana plant began production with 5 million tonnes of cement, [6] the group then invested funds in another cement operation at Ibeshe, Ogun State to shore up the local manufacturing sector from about 2.5 million tonnes to up to 8 million tonnes. [6] To reduce economic and political risk within the country, the group began looking for opportunities to expand beyond Nigeria. [8] The company's strategy then focused on continental expansion with the building and acquisition of cement plants in African countries. [6]

Today, Dangote Group is a diversified conglomerate, headquartered in Lagos, with interests across a range of sectors in Africa. [9] [10] Current interests include cement, sugar, flour, salt, seasoning, pasta, beverages and real estate, with new projects in development in oil and natural gas, telecommunications, fertilizer and steel. [7] [11] [9] [12] Competitors in both Nigeria and other portions of Africa include Stallion Group. [13]

Subsidiary companies

Entrance of Dangote Cement head office in Douala, Cameroon Headquarters of Dangote Cement Cameroon.jpg
Entrance of Dangote Cement head office in Douala, Cameroon

Dangote Cement, the largest cement production company in Africa, with a market capitalization of almost US$14 billion on the Nigeria Stock Exchange, has subsidiaries in Benin, Cameroon, Ghana, Nigeria, South Africa and Zambia. [14] In December 2010, the group signed an agreement with the Government of Zambia to construct a US$400 million cement plant in Zambia. It was completed in 2015 and is located in Ndola, The plant produces 42.5-grade cement to compete against the lower-grade but dominant 32.5 products in the market, the new plant is expected to have an annual output of 1.5 million metric tonnes of cement. [15]

Dangote Sugar is another major subsidiary of Dangote, competing with Bua Refinery Ltd. and Golden Sugar Co. [7] Dangote Sugar is the largest sugar refining company in sub-Saharan Africa. [16]

Petrochemicals

The group has also diversified into oil and gas-related ventures, establishing a 3 million tonnes fertilizer plant, petroleum refinery capable of refining 650,000 barrels of oil and a petrochemical operation. [8] Dangote Refinery was inaugurated in May 2023, and is the largest refinery in Africa at full capacity. [17] [18]

Nigerian businesses

Firm [19] InterestSector
Dangote SugarConsumer goods
Dangote PastaConsumer goods
National Salt Company (NASCON)Consumer goods
Dangote Classic SeasoningConsumer goods
Dangote Oil and GasBusiness support
Dansa FoodsAgro-allied
Dangote TransportationLogistics
Dangote Agro-sacksBusiness support
Greenview DevelopmentPort management
Savannah SugarAgro-allied
MHF Properties [20] Property development

See also

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References

  1. ↑ Okafor, Prince (23 February 2018). "Dangote Group's revenue exceeds $4.1bn in 2017". Vanguard Nigeria. Retrieved 14 April 2018.
  2. 1 2 3 4 Okeowo, Alexis (7 March 2013). "Africa's Richest Man, Aliko Dangote, Is Just Getting Started". Bloomberg. Retrieved 25 October 2016. he did, however, receive a loan of a little more than $3,000 from his uncle to start a trading enterprise in food staples
  3. ↑ Bello, Olushola (2021-05-25). "Nigeria: Dangote Investments Generate Employment Opportunities". allAfrica.com. Retrieved 2022-02-09.
  4. ↑ "LIONS ON THE MOVE II:REALIZING THE POTENTIAL OF AFRICA'S ECONOMIES". McKinsey Global Institute. 7 September 2016. Retrieved 20 April 2018.
  5. ↑ "Dangote pipeline job in Nigeria a welcome boost for COOEC". Energy mix report. 16 December 2016. Retrieved 26 July 2018.
  6. 1 2 3 4 5 6 7 Nigerian Investment Promotion Commission (2006). "Diversification with Excellence". Corporate Nigeria. OCLC   319061547.
  7. 1 2 3 Akingbade, Akinkunmi (29 September 2016). "As things stand, Nigeria will not achieve its 2023 sugar self-sufficiency plan". Ventures Africa. Retrieved 25 October 2016.
  8. 1 2 3 4 5 Edwin (March 9, 2015). "Edwin - How We Built Dangote Group Into Largest Manufacturer in Africa" (Interview). Interviewed by Crusoe Osagie.
  9. 1 2 Nsehe, Mfonobong (2 April 2015). "Africa's Richest Man Aliko Dangote Enters Joint Venture With Italian Giant Saipem". Forbes. Retrieved 25 October 2016.
  10. ↑ Nsehe, Mfonobong (4 September 2016). "Africa's Richest Man Aliko Dangote To Invest $170 Million In Rice, Sugar Production In Nasarawa". Forbes. Retrieved 25 October 2016.
  11. ↑ Hirsch, Afua (3 April 2012). "Africa's richest man is cementing his place in history". The Guardian. Retrieved 25 October 2016.
  12. ↑ Dangote Group Ventures Into Fertilizer
  13. ↑ Saritha, Rai (23 September 2015). "Dubai-Based Billionaire Vaswani's Stallion Group Wants To Dominate Nigeria And All Of West Africa". Forbes. Retrieved 25 October 2016.
  14. ↑ Dangote Group's Cement Operations Span Six African Countries
  15. ↑ The Zambian Cement plant has started its operations.Nigerian Tycoon To Invest $400 Million In Zambia Cement Plant
  16. ↑ Ochelle, Felicia Omari (9 November 2015). "Dangote Sugar has a new Managing Director". Ventures Africa. Retrieved 25 October 2016.
  17. ↑ "Billionaire's huge Nigerian oil refinery likely delayed until 2022: sources". Reuters. 10 August 2018. Retrieved 13 October 2018.
  18. ↑ "Africa's richest man launches $20billion refinery". CNN.
  19. ↑ "Our Businesses – Dangote Industries Limited" . Retrieved 2019-09-15.
  20. ↑ "MHF Properties" . Retrieved 2020-08-28.
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