The company was founded in 1981 as a trading enterprise, importing sugar, cement, rice, fisheries, and other consumer goods for distribution in the Nigeria market. The group moved into manufacturing in the 1990s, starting with textiles, moving onto flour milling, salt processing and sugar refining by the end of the decade. The company next moved into cement production, growing rapidly and moving into other African countries. A high degree of vertical integration is a hallmark of Dangote Group's operating strategy. The group now owns and operates over 18 subsidiaries, operating in ten African countries. Dangote Cement, is one of these subsidiaries that is listed on the Nigerian Stock Exchange, with its market capitalization accounting for almost 20 percent of the total capitalization of the Nigerian Stock Exchange. Dangote Group is headquartered in Lagos. In 2016, Dangote signed a contract with CNOOC group for the installation of a large underwater offshore pipeline. The pipeline, when completed will extend from Bonny through Ogedegbe, Olokola to Lekki and the Escravos Lagos pipeline, finally terminating at the West Africa Gas Pipeline.
Overview
The origin of the group began in the late 1970s, when Aliko Dangote after receiving a $3,000 loan from an uncle, established a venture that traded consumer goods such as sugar between the years 1978 and 1980, before gradually expanding into trading other commodities such as rice. In 1981, he established two business enterprises, Dangote Nigeria Limited, and Blue Star Services, this was a period when import licenses were required to import bulk commodities, the firm then sought to acquire import licenses for various commodities including steel, baby food, and aluminium products. He then added the shipping and the importing of cement to his group's portfolio. Dangote competed with Lafarge, a French company that imported and produced the bulk of African cement. When the import license era was discontinued in 1986, the firm concentrated in bulk importing of salt, sugar, and rice and gradually reduced its cement business.
Manufacturing
The group's first foray into manufacturing began in 1989 with textiles Mills Limited, operating two operations, a textile weaving mill in Kano and the Nigerian Textile Mills limited's plant in Lagos. Beginning in 1997, following a decline of the textile sector, the company concentrated on manufacturing consumer goods it was importing into Nigeria such as sugar refining and flour milling, with the former it competed against imported products from Brazil and Europe. One of the biggest distributors of sugar in Nigeria, Dangote sugar refinery began local production in 1999. The strategy towards backward integration led to the establishment of a pasta plant and also flour milling to supply raw materials for making pasta. The company then invested in a cement manufacturing venture at Obajana, Kogi State, with an aggressive strategy, the Obajana plant began production with 5 million tonnes of cement, the group then invested funds in another cement operation at Ibeshe, Ogun State to shore up the local manufacturing sector from about 2.5 million tonnes to up to 8 million tonnes. To reduce economic and political risk within the country, the group began looking for opportunities to expand beyond Nigeria. The company's strategy then focused on continental expansion with the building and acquisition of cement plants in African countries. Today, Dangote Group is a diversified conglomerate, headquartered in Lagos, with interests across a range of sectors in Africa. Current interests include cement, sugar, flour, salt, seasoning, pasta, beverages and real estate, with new projects in development in oil and natural gas, telecommunications, fertilizer and steel. Competitors in both Nigeria and other portions of Africa include Stallion Group. Adenike Fajemirokun is the chief risk officer.
Subsidiary companies
, the largest cement production company in Africa, with a market capitalization of almost US$14 billion on the Nigeria Stock Exchange, has subsidiaries in Benin, Cameroon, Ghana, Nigeria, South Africa and Zambia. In December 2010, the group signed an agreement with the Government of Zambia to construct a US$400 million cement plant in Zambia. It was completed in 2015 and is located in Ndola, The plant produces 42.5-grade cement to compete against the lower-grade but dominant 32.5 products in the market, the new plant is expected to have an annual output of 1.5 million metric tonnes of cement. Dangote Sugar is another major subsidiary of Dangote, competing with Bua Refinery Ltd. and Golden Sugar Co. Dangote Sugar is the largest sugar refining company in sub-Saharan Africa.
Petrochemicals
The group has also diversified into oil and gas-related ventures, establishing a 3 million tonnes fertilizer plant, petroleum refinery capable of refining 650,000 barrels of oil and a petrochemical operation. Dangote Refinery is expected to begin operations in the early 2020s, and will be the largest refinery in Africa at full capacity.
