Aliko Dangote Is Africa's First $20 Billion Man, Now 25th World Richest!
Nigerian
billionaire and Africa’s richest man Aliko Dangote has become the first
African entrepreneur to lay claim to a $20 billion fortune as the stock
value of his largest holding, Dangote Cement, leaped just about
three-fourths since March when Forbes released its annual ranking of the
world’s richest people
Aliko Dangote’s 93% stake in the cement company is now worth $19.5 billion.
Add
this to his controlling stakes in other publicly-listed companies like
Dangote Sugar and National Salt Company of Nigeria and his significant
shareholdings in other blue-chips like Zenith Bank, UBA Group and
Dangote Flour; his extensive real estate portfolio, jets, yachts and
current cash position, which includes more than $300 million in recently
awarded Dangote Cement dividends, Dangote is now worth more than
$20
billion.
Put into context, the Nigerian billionaire is now among
the top 25 richest people in the world, richer than Russia’s richest
man, Alisher Usmanov, richer than India’s Lakshmi Mittal and running
neck and neck with India’s Mukesh Ambani. He is catching up to such
Americans as Google’s billionaire founders Larry Page and Sergey Brin.
The
unprecedented surge in Dangote Cement’s share price is largely a market
response to the company’s impressive 2013 Q1 results.
The cement
manufacturer’s unaudited results for the three months ending March 31
showed that the company’s pre-tax profit rose to $339 million,
representing an 80.6% increase from last year and a strong indicator of
the company’s future earning potential. The results also indicate a 79.5
% rise in its earnings per share over the corresponding period last
year.
Explaining the company’s share price boost in an email to
Forbes, Carl Franklin, Dangote Cement’s Head of Investor Relations in
the U.K said that in the first quarter of 2013, the company had a huge
increase in demand across Nigeria, gas supply improved considerably and
the capacity was much more ramped up.
“So Q1 was the first sign
of just how profitable we can be in Nigeria. The amazing thing is that
66% of our gas-fired production in Q1 was done at 84% gas. Imagine what
would happen to margins if we did the same amount at 95%. This has given
investors a good sense of what we can really do when everything goes in
the right direction,” Franklin said.
With a current market cap
of $20.5 billion, Dangote Cement becomes the first Nigerian company to
achieve a market capitalization of over $20 billion.
“It’s
certainly a landmark for a Nigerian company and we’re proud to be the
first to achieve it. Obviously we are focusing on building long-term and
sustainable value for shareholders through our investments in Nigeria
and Africa. Nigeria is a very entrepreneurial country and I can assure
you that other companies will follow us in achieving this.”
Other
companies might eventually achieve this, but it’s going to take a bit
of time. Dangote Cement currently accounts for more than a quarter of
the total market capitalization of the Nigerian Stock Exchange. The
second largest company on the Nigerian Stock Exchange (NSE) is currently
Nigerian Breweries, West Africa’s largest manufacturer of Alcoholic and
non-alcoholic beverages. The company has a market cap of $8.5 billion.
Dangote
debuted on the FORBES billionaires list in 2008 with a fortune we
pegged at $3.3 billion. His fortune dropped to $2.5 billion in 2009 and
plunged further to $2.1 billion in 2010. His fortune surged 557% in
2011 to $13.8 billion after he took Dangote Cement public. He dropped to
$11.2 billion in last year’s rankings, but rebounded at $16.1 billion
this year. Since March, his fortune has jumped another 30%.
Dangote
was destined to shine in business. At age 8, he apparently gave packets
of sweets he had made to the house servants to sell for him. His father
Mohammed Dangote was a successful businessman and an associate of his
maternal uncle Alhaji Sanusi Dantata. Dantata and his brother controlled
the trade in kola nuts and livestock conducted by 200 agents. Dangote
started building his fortune over three decades ago after taking a loan
from Sanusi Dantata. He started trading in commodities like flour, sugar
and cement.
He became a billionaire by later manufacturing these
items. He started making pasta, salt, sugar and flour in 1997. But he
found his gold mine in cement, when he was awarded a government’s state
owned cement business in 2000 and began building his own plant in 2003.
He listed Dangote Cement in 2010.
Today, it is Africa’s largest
cement company providing cement to Nigeria and other African countries
that otherwise would likely have to pay to import much of the materials.
Dangote
still likely has bigger ambitions. He told Forbes Wealth Editor Luisa
Kroll at Davos in 2011 that he expected his firm to have a market cap of
$60 billion within five years. At $20.5 billion, Dangote Cement still
has a long way to go to live up to that dream, and while it is quite
unlikely that Dangote Cement could hit a $60 billion Market Cap by 2016,
don’t write it off as ‘impossible’. With Dangote, you never know.
This is an inspirational story of the growth of a tenacious Nigerian businessman. Keep the cement bags rolling out Aliko.
ReplyDeleteIte ego!
ReplyDeleteAll of his investments re situated in defrauding Nigeria by his associates who re strategically positioned in the Nigeria government who loot our treasury and entrust their looted money into his hand for save keeping. Am not impressed because he is abatting corruption by accepting those money for his investment
ReplyDelete