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Aliko Dangote, founder and CEO of Dangote Group, gestures during an interview in his office in Lagos in this file photo. Mr. Dangote’s entrepreneurial skills have helped make him Africa’s richest person. (AKINTUNDE AKINLEYE/REUTERS)
Aliko Dangote, founder and CEO of Dangote Group, gestures during an interview in his office in Lagos in this file photo. Mr. Dangote’s entrepreneurial skills have helped make him Africa’s richest person. (AKINTUNDE AKINLEYE/REUTERS)

In Nigeria, a concrete get-rich scheme Add to ...

Aliko Dangote has always liked making things to sell. As a child he boiled up sugar to make sweets he sold around town; these days he cooks up limestone in factories that produce millions of tonnes of cement.

Mr. Dangote’s entrepreneurial skills have helped make him Africa’s richest person, with cement plants opened or under construction everywhere from Senegal to Ethiopia to South Africa. He dreams of owning the largest cement firm on the planet. By 2015, he hopes, his industrial conglomerate will be worth four times its current estimated $15-billion. (U.S.).

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“We’ve taken the flag of Nigeria and flag of Africa and put them in places they never expected to be seen,” beams the slightly greying, young-faced tycoon sitting in his office in the commercial hub of Lagos. Behind him is a map of Africa and a photograph of his cement plant in the town of Obajana, set to have a capacity of 13.25 million tonnes a year by 2015, which would make it the world’s biggest.

But the 55-year-old is not without controversy. To some, he is an unassuming man whose quiet demeanour stands out in a nation where success is usually marked by talkative swagger; to others, he is a monopolist who uses aggressive tactics and political ties to beat competitors.

Critics accuse him of using his influence with successive governments to ban imports by his competitors, pushing port authorities to halt rivals’ shipments, and using sharp price drops to put them out of business.

Mr. Dangote admits he has been friends with several recent presidents of Nigeria and has enjoyed lucrative tax breaks, though he denies receiving any special favours.

However he got there, there is little doubt his success in manufacturing is a rarity in a continent seen as too dependent on exports of raw materials – minerals and cash crops – with no added value. By contrast, the Dangote Group refines sugar, mills flour, processes salt, and produces cement.

At present only 5 per cent of Dangote Cement and 25 per cent of Mr. Dangote’s flour and sugar companies are publicly traded; almost all of the other shares are held by Dangote. His total annual paycheque isn’t public, but Dangote Cement, Dangote Flour Mills and Dangote Sugar are all hugely profitable.

Dangote Cement’s pretax profit for the first half of 2012 grew by 23 per cent to 71.3 billion naira ($443-million). The sugar refiner nearly doubled its profits to 8.5 billion naira over the same period.

When Mr. Dangote floated the cement firm in late 2010, it boosted his estimated personal wealth five-fold to $13.8-billion, making him the fastest riser on the Forbes rich list. After a bad year on the Nigerian stock market, he is still worth $11.2-billion.

Mr. Dangote now wants to list 20 per cent of the cement company on the London Stock Exchange late next year, at a price that would value it at $35-billion to $40-billion. That would make it the world’s top cement firm by market capitalization, bigger than Lafarge of France, and surpassing mobile phone operator MTN as Africa’s top stock.

Hurdles remain. The tycoon will have to convince investors and regulators that his personal empire can be a FTSE 100 firm with the necessary corporate governance standards. That would be a rare feat for a Nigerian company. Guaranty Trust Bank and Diamond Bank have secondary listings in London, but both are too small to make the top FTSE index.

Born in April 1957 in the northern Nigerian city of Kano, Mr. Dangote comes from a family of wealthy Muslim merchants. After demonstrating his early entrepreneurial spirit selling sweets, he headed to Egypt to study business at Cairo’s Al-Azhar university.

In 1977 he borrowed about 500,000-Nigerian naira from his uncle to trade basic foods: cooking oil, sugar, pasta. Four years later he bought trucks to start a transport firm and within a decade was importing bulk goods, including cement. By the time he turned his hand to manufacturing the stuff – buying a defunct cement plant in 2000 and reviving it – he was a rich man.

Mr. Dangote, who married young and has three daughters – he and his wife are now estranged – says he has never been motivated by wealth.

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