Dangote sets sights beyond Africa

Dangote Cement is expanding out of Africa. While its chairman Aliko Dangote remains firmly committed to the continent and its 40Mta production capacity owned by the company, he has set his sights beyond its borders – starting with Iraq and Myanmar, where plant construction could start as early as next year. When asked why he is investing specifically in those locations, he gives the example of Myanmar. As the country opens up, the opportunity is currently there to invest but may disappear at some stage later.

In addition, Indonesia, Brazil and Chile have been added to the capacity building programme with the plan to reach 60Mt of annual production outside Africa over the next five years. The move underlines and expands Mr Dangote’s current position as the biggest investor in sub-Saharan Africa.

Dangote Cement, which was listed on the Lagos stock exchange last year, is further planning a London listing next year, with Dangote Industries, Dangote’s unlisted holding company selling an interest of around 20 per cent, reducing its stake to 75 per cent. If valued at today’s market capitalisation of around US$13bn, the sale is expected to be valued at US$2.6bn. However, Mr Dangote said the money would not be invested into Dangote Cement but other investments and hence, it appears that the expansion across Africa’s borders will be carried out without turning to the equity markets.