Dangote, the man with a Midas touch

When on 10th of April 1957, a male child was born in Kano, little was heard or known of the child. Like Shakespeare wrote in one of his epic books, Julius Caesar, when beggars die there are no comets seen but the heavens themselves blaze the death of Princes. In some dynasty and royalties, when kings are born, they are celebrated. That was not the case in Kano when Aliko Dangote was born. He was just like any other child. He, like other children, learnt to crawl, walk and run. He cried like others but at school he was focused on what he chose to do.

He probably discovered his destiny early enough and keyed into it. In his words: “I can remember when I was in primary school, I would go and buy cartons of sweets (sugar boxes) and I would start selling them just to make money. I was so interested in business, even at that time.” Dangote, right from when he was young had his eyes on business.

He had always, as all real entrepreneurs do, see opportunities where others see high risk and failure. In an atmosphere of difficulty, when others would have given up, he took the risk. He is known for taking great risks in a highly risky environment.

He has grown to have a Midas touch in every business he ventured into. He started as a commodity trader, he made success of it, he entered into sugar refining, and he made success of it. He set up cement manufacturing; he has made a huge success of it.

Now he is venturing into petroleum product refining. His hard work has set him apart to the envy of his detractors who only see in him as a beneficiary of government waiver and concession. But there are others who have had the same benefit but could not make any thing tangible from it.

That has brought success to him, his family, state and his country. He has invested in the various sectors of the Nigerian economy and across the African continent thus creating millions of direct and indirect jobs in the continent of Africa. He has become a business colossus that bestrides the global business environment, making him the richest African today.

In one of the articles written by Jonathan Berman in Harvard Business review entitled American CEOs should Stop Complaining about Uncertainty, he wrote how uncertainty has not deterred Aliko Dangote from investing in Nigeria and across Africa. In the write- up Barman said: “This month, the chief executive officers of America’s biggest companies went on a media blitz to decry the uncertainty caused by the fiscal cliff. In such uncertain times, they say, they are hesitant to invest in the US economy.

I departed Washington in the midst of these rumblings to attend a forum of Africa’s leading CEOs. Here’s a quick sample of the scheduled participants: Aliko Dangote, CEO of Dangote Cement. He’s building a $2 billion fertilizer plant in his native Nigeria. He recently announced the next two growth markets for sizeable investment by his group are Iraq and Myanmar.

“For Dangote and many other executives in frontier markets, uncertainty is not the inhibitor of opportunity. It is the condition in which opportunity arises. That is a reasonable perspective to look for in American CEOs as well.” The moving force behind private enterprise all over the world is what Adam Smith described as the invisible hand that allocates resources in the most uncertain environment.

It is real entrepreneurs that see opportunity in very risky areas, yet go in there with the hope of making profit. Business is about taking risk and any local entrepreneur that is not ready to take risk is not a genuine businessman. Dangote saw opportunities in the very uncertain and tough business environment in Nigeria. From trading in rice, sugar and other commodities, he veered into manufacturing in an environment many foreign and local investors see as very risky.

Alhaji  Aliko Dangote’s business empire is estimated at a net worth of $20.8 billion as of November 2013 spanning interests in commodities with operations in Nigeria and several other countries in Africa , including Benin , Cameroon , Togo , Ghana , South Africa  and Zambia . Dangote in 2013 was ranked by Forbes Magazine  as the 43rd richest person in the world and the richest man in Africa based on his investment and the listing of his companies’ interest at the Nigerian Stock Exchange. Taking some of his companies to the exchange has given other Nigerians opportunities to share in his success and has shown that he operates his companies in an open manner.  .

Early life

Alhaji Aliko Dangote, a northerner, precisely from Kano State, Nigeria was born on the 10th of April 1957 into a wealthy Muslim family. He studied business from the Al-Azhar University  in Cairo, Egypt  and thereafter returned to Nigeria to borrow from his uncle Sanusi Abdulkadir Dantata. The uncle (Dantata) eventually gave him a loan of N500,000 when he was just 21 years old to start his own business.

Business career

The Dangote Group which started as a small trading firm was established in the year 1977. Today, it is a multi-trillion naira  conglomerate with many of its operations in Benin , Ghana , Nigeria , and Togo . At present, Dangote has enlarged his line of businesses to also cover food processing, cement manufacturing, and freight. The Dangote Group also dominates the sugar and cement market in Nigeria and is a major sugar supplier to the Nigeria’s soft drink  companies, breweries , and confectioners . The Dangote Group has also moved from being a trading company to being the largest industrial group in Nigeria and these include: Dangote Sugar Refinery , Dangote Cement , and Dangote Flour  just to mention but a few. He plans to set up the largest petroleum product refinning facility in Nigeria.

In the month of July 2012, he approached the Nigerian Ports Authority with the idea of leasing an abandoned piece of land at the Apapa Port, which was welcomed and approved. He later went to build facilities for his flour company there. In the 90’s, he approached the Central Bank of Nigeria with a proposal that it would be cheaper for the bank to allow his transport company manage their fleet of staff buses which was also approved.

He owns the Obajana cement plant which is the largest cement manufacturing facility in Africa. Apart from these, Dangote Group owns salt factories and flour mills and also a major importer of rice, fish, pasta and fertilizer. The company exports cotton, cashew nuts, cocoa, sesame seed and ginger to several countries. It also has major investments in real estate, banking, transport, textiles and oil and gas.

The company employs over 11,000 people and is the largest industrial conglomerate in the whole of West Africa. Dangote is also exploring the telecommunications sector and has started building 14,000 kilometres of fibre optic cables to supply the whole of Nigeria and as a result, he was honoured in January 2009 as the leading provider of employment in the Nigerian construction industry.  Africa’s richest man, Aliko Dangote, continues to expand his publicly traded Dangote Cement across the continent, announcing plans to build new plants in Kenya and Niger. With operations in about eight countries, it is the largest cement manufacturer in sub-Sahara Africa.

In May, 2013 Dangote said he would build a $9 billion oil refinery and petrochemical complex in Nigeria. When completed, it will be Nigeria’s first and Africa’s largest petroleum refinery.

His words; “As an investor who believes in Nigeria, knows Nigeria well and whose prosperity was made in Nigeria, we have responded to the challenge with our decision to invest $ 9 billion in a refinery/petrochemical and fertilizer complex to be located at the OKLNG Free Trade Zone.  This complex will be the largest industrial complex project ever in the history of our great nation.

The project had effectively taken off, with the award of the Engineering, Procurement and Construction (EPC) contract to Saipem of Italy for the fertilizer plant. The Basic Engineering Design and optimisation for the refinery has also been awarded. When completed, the fertilizer plant would produce 2.75 metric tons per annum of urea and ammonia; while the refinery would process 400, 000 barrels of crude oil per day.

The refinery would produce a higher grade of premium motor spirit, popularly known as petrol, compared to what is currently being imported into the country. According to him, in addition to high grade petrol, the refinery would produce diesel, aviation fuel, household kerosene, slurry as raw material for carbon black, as well as 650,000 metric tons of polypropylene per annum.

Dangote’s mission is to reverse the current situation in which Nigeria has not only become a net importer in her trade relations with nations of the world but also of products for which it has comparative advantage. He said “Our mission is to through industrialisation, reverse the historical trend of the export of foreign exchange and jobs and replace it with foreign exchange conservation and job creation;” promising to replicate his success story in the cement industry where he has turned the nation from an importer to a current level of self-sufficiency and with potentials for exports within a short while.

If the refinery and the petrochemical plant come on stream, Nigeria will reclaim its place of pride as one of the largest exporters of fertilizer, refined products and other petrochemical products, to consolidate on its efforts in ensuring the rapid development and the contribution of Africa to the global economy. The billionaire plans to spend up to $350 million to build a new cement plant in the Republic of Niger which will boost Dangote Cement ’s annual output by 1.5 million tonnes.

He made the announcement after a meeting with Niger’s President Issoufou Mahamadou in the capital, Niamey. Dangote said the new cement plant will produce its own electricity and any surplus will be channeled to Niamey’s power grid. The new venture is expected to create 6,000 to 7,000 jobs. At the moment, Niger has only one cement plant, built in 1964, which produces a mere 40,000 tonnes annually. The country relies heavily on cement imports from Nigeria.

Dangote Cement is the largest cement producer on the continent and its ambitious founder is aggressively pursuing growth across the continent. In September, Dangote announced that he will invest $400 million to build a cement plant in Kenya. The company aims to achieve an annual production of 55 million tonnes by 2016 and is investing $5 billion to build cement plants across the continent.

On the 14th of November, 2011, Dangote was awarded a National Honour, Nigeria’s second highest honour, Grand Commander of the Order of the Niger  (GCON ) by the President of Nigeria, Goodluck Jonathan .

Apart from his business acumen, he is also a philanthropist who has collaborated with American billionaire, Bill Gates Foundation to invest the provision of health especially the eradication of polio in Africa and other parts of the world where the disease is still prevalent.