Have you run into Alhaji Aliko Dangote of late? If you have, you must have noticed that his jet-black hair is fast going grey. Its not on account of old age, but stress. Though, he turned 60, a few months back, the Kano-born billionaire is still very fit strong and agile. He does not look that age at all. But the huge weight of the running of his ever expanding business empire is weighing heavily on him.
That is to be expected if you run the kind of conglomerate he runs. He runs a multinational corporation that operates in several countries. Aliko is the clear leader of a new breed of African multinational entrepreneurs.
That is why if you put a call to him right now, he is likely to pick up your call in Cairo, Dakar, Accra, New York or London. Why is that so? Over the last few years, Aliko, who is the Chairman of Dangote Group has become a global citizen, a citizen of the world who sees the whole world as his space. He has become an international businessman, in the true sense of the word searching for new opportunities, new vistas. He has investments all over the world, playing big in Cement, Sugar, Salt, Oil Refinery, Petro-Chemicals, Fertilisers, Polysacks, Logistics, Real Estate, Steel, Oil & Gas, Telecom, Food & Allied Products. And he is not a small fry in the game. He plays really big. As a rule, he never invests in any sector he cannot quickly become Number one or in a worst case scenario, Number two.
That he is aging gracefully is because of the heavy responsibilities on his shoulders. If you run a big brand with tentacles spread over 10 African countries, then you can imagine the mental and physical energy you need to sustain them. In addition to that, Aliko is currently midwifing about 10 new mega projects, across Nigeria, and other African countries. But he is lucky, he has good hands. He has over 5,000 workers across the world and a team of experts, who manage the group. They are called Team Dangote. He has staffers in about 14 African countries. And he has expatriates from the UK, US, Germany and other European countries.
That has made his job a bit easier. They are 1st class Technocrats, who are very knowledgeable about the different industries they play in. Aliko also has about 10 Special Consultants mainly Nigerians knowledgeable in strategic areas such as Petrochemicals, Oil & Gas and Cement.
These are seasoned professionals, who have put in more than 40 years of active practice. So, he has a formidable team in place. That partly explains why Dangote Group has become a leader in the African business.
Wait for the figures: the group is one of the Top 10 in Africa and Top 400 globally. The group is globally competitive, growing local capacity, manufacturing quality products. It is rapidly transforming from a Nigerian company to a dominant African brand and its listed companies account for 35-40% of NSE capitalisation. Unknown to many, Dangote DCP is the most capitalised company on NSE and in W. Africa. And the group’s revenues and profitability have continued to grow. And wait for this: the group is very bullish on Africa, because the group believes Africa is still a land of opportunity.
City People found out that, the group believes Africa’s troubled past is steadily giving way and a new growth story is fast emerging, what with the average of 5.5% growth rate over the past 10 years, and the economy has more than tripled since the turn of the century. Going by estimates, by 2050, one person in 5 in the world, would be African, with 63% urbanisation rate. Also 60% of the world’s uncultivated arable land is in Africa.
Beyond this, several growth drivers exist: Political stability, improved macro-economic environment, micro-economic reforms, rapidly expanding middle calss (now 355mn).
But there are still many challenges such as the collapse in commodity prices negatively impacting on economic growth, huge infrastructure gap, especially Power ($100bn annual investment required), Corruption and low intra-Africa trade (16%), owing to restrictive visa and tariff regimes. But the Dangote Group believes a resilient investor can overcome these and it is not just Dangote that is in it alone. There are others such as Coca-Cola ($5B), GE ($1B) Bombardier, Ford Motors, PE Funds, Nestle, Heineken, P & G, etc. are expanding their African footprints.
Why many people often commend Aliko is because of how he has been able to grow Dangote Group from a simple commodity trading company to a diversified conglomerate in just two decades.
The story began in 1978 when the company started as a commodity trading company. The abolition of the import licencing regime increased the possible scope of operations to become a leading bulk trader of various commodities. Between 1978 and 1997, it went into Banking/Textiles. Then the transition began in 1997-2000, when it transformed from a bulk commodity trading company to a manufacturing concern, via an import substitution strategy along the group’s traditional business lines.
DIL was incorporated as the vehicle for executing growth strategy. It developed brand equity for products. The growth sustenance years came between 2000-2003 with the acquisition of strategic assets, expansion of existing capacities, prudent management/strategy of reinvesting funds and improving business process and structure to align with the group’s business vision.
Between 2003 and 2007, there was an expansion and a restructuring. And the massive conglomerate witnessed an annual group revenue of US$1.6bn (FY06). There was a spin off of Sugar, Flour, Salt and Pasta divisions to wholly owned subsidiaries. Then, there came a successful IPO and listing of sugar, flour and salt businesses, plus the commissioning of the largest cement plant in sub-Saharan Africa i.e, Obajana Plant (5MMtpa-Phase I). From 2007 to the present time, the group has witnessed much diversification and consolidation of the group.
There was diversification into Infrastructure, Agriculture, Fertiliser, Petrochemicals, Steel, Oil & Gas. Then, there was domestic expansion to ensure strong presence along the food value chain. Then, there was improvement in business processes, governance and organisational structure and the consolidation of cement interests and listing of DC Plc and the expansion of cement footprint in Nigeria and across Africa.
Today, it has become a rapidly evolving multi-business, multi-geography portfolio. The existing businesses include Cement, Food and other areas. The group has several cement plants across Africa.
As for food, it produces Sugar, Salt, Tomato Paste, Seasoning, Vegerable Oil, Refining and Fractionating, Flour, Pasta, Noodles.
Other business aspects include Packaging, Logistics, Steel, Real Estate and Mining. The group is engaged in new projects in Oil and Gas, Agriculture, and Infrastructure.
It has Upstream assets, sub-sea gas pipeline, Petroleum refinery/petrochemical and fertilizer. It has moved into Agriculture big time. It is involved in Rice and Sugarcane processing while in terms of Infrastructure it is involved in Power and the construction of Concrete Roads. Now you can see why Alhaji Aliko Dangote hardly sleeps and hardly goes on vacation.
-Seye Kehinde
