By Sheikh Juma
Earlier this week, news broke that Aliko Dangote was moving 60% of his family investment to the US.
Two days after, we saw him in Tanzania promising to increase his investment in the country because he wants to support the new president, whose business decisions have been investment friendly.
I am happy for him. He has sense.
But as a businessman, I am not sure Dangote is a model.
Don’t take my word for it.
Let the data speak:
In October 2016, Dansa, Dangote’s fruit juice company packed up because it wasn’t making profit.
It closed shop, owing its workers 6 months salary.
He also started a $13 million tomato processing plant in March 2016 and closed shop in August 2017, saying it was because of “importation of tomato paste, shortfall in the supply of fresh tomatoes and power failure.”
It is funny that they didn’t consider these three factors before commencing.
So they started a tomato farm that will supply fresh tomatoes, then do some kind of backward integration.
After spending $3million to set up a green house, the farm died.
It has been starting and stopping since then.
No money, no tomatoes, no factory.
In November 2017, it was the turn of Dangote noodles to go under.
In his words, they wanted to “focus on pasta and flour.”
He sold the noodles factory to his biggest rival, Dufil, makers of Indomie. It was like Coca-Cola buying a Pepsi plant. A business abomination.
Have you ever wondered what happened to Mowa Water, Dangote’s bottled water?
Well, it went down with Dansa, or soon after.
Then his Dangote Flour was acquired by Olam in 2019.
He left the noodles business to concentrate on flour. But even the “commitment to flour” wasn’t enough to stop Dangote Flour from baking and burning.
At the start of the Ramadan fast, Dangote Sugar wrote a petition against BUA Sugar, asking the FG to place trade sanctions on BUA for “undermining the National Sugar Master Plan.”
In English, he wanted the FG to tilt the competition in his favour again by grounding BUA.
BUA claimed that he was being blackmailed because he refused to hike sugar prices at Ramadan, like Dangote did.
Here is my point: wherever and whenever there is competition, Dangote would either crop out or try to change the business rules in his favour using his government connections.
He couldn’t sell Table water because he was competing with pure water sellers;
He couldn’t sell noodles because of Indomie :
He couldn’t sell Flour because of Honeywell, Golden penny etc;
He couldn’t sell Tomato paste because of Derika and other pepper sellers in the market.
He couldn’t sell Fruit juice because of Chivita, 5-Alive etc.
Dangote would only do well where Government policy is in his favour and competitors are given a bad hand by Government Regulators.
I read a Reuters report some years ago (and it’s still online) which revealed that at the height of the naira-dollar crisis of 2016, Dangote bought at LEAST USD $161million in hard currency direct from the CBN between March and May 2016. This amount was 90% of all the USD sold by CBN within that period.
All other manufacturers – 2,000 of them – got the balance of 10%.
He bought the USD at the official rate of N197/199 while other businesses bought from the black market at N320.
Reuters reported that Dangote made over US$100 million from this Forex deal.
Dangote has always been the favourite side chic of every government since the return to democracy.
In 2003, he was alleged to have part-funded Obasanjo’s re-election campaign when Atiku was doing anyhow.
Then he befriended Yar’adua, Goodluck, and Buhari.
On the day Goodluck, his former zaddy was licking his wounds from the electoral defeat of 2015, Dangote was alleged to be clinking glasses and performing a lap dance for Buhari, his new zaddy.
But why would such a “successful businessman” be thinking of moving 60% of his family investment to the US, and even adding to his capital investment in Tanzania which is already about $770million?
The answer is in Buhari.
In 2015 when this administration took over, Dangote’s net worth was US$17.7 billion.
Right now, it IS US $11.1 billion.
Meaning that in 6 years of Buhari, he has lost about 40% of his net worth.
Project two years forward:
what would his net worth be in 2023? My projection is that he might be worth AROUND US $8 billion, or less, depending on what happens to his refinery, and what happens in the security mileu?.
With all the favours:.
special limestone mining licenses, etc,
Aliko’s money is still melting like cotton candy on a hot summer afternoon.
He has now activated his Plan B.
Can you blame him?
Sometime last year a short video was leaked by his side chic and we had the rare privileged of seeing a billionaire butt.
Now we know that even Dangote himself is a side chic, an unfaithful one at that, moving from patron to patron: Obasanjo, then Yar’adua, then GEJ, now Buhari.
On another level, his zaddy was Nigeria. Now he has two new zaddies: the US, where his funds will be protected from melting, and Tanzania where Madam President will help him recover the 40% that he lost in the hands of the Nigerian economy.
Those who are in doubt that NNPC funded Dangote Refinery 100% should go and ask Ex Minister of State Petroleum Dr. Ibe Kachikwu who and who got the $ 25 billion contract that he raised alarm on after he returned from vacation. They immediately removed the office of the GMD from his control and later he was forced to resign as the Minister of State for Petroleum.
You want to know who funded the Dangote Refinery, go to the Ministry of Finance and call for Dangote’s file and tell me even if you give a goat in suit the same concession, the same waiver or the same opportunity given to Dangote, tell me if that Goat won’t be the richest being in Africa.
You want to know how the Dangote Refinery was funded, go to Warri Refinery and Kaduna Refinery, find out who was given an exclusive right to lift Low Pour Fuel Oil (LPFO) for a long time. NNPC claimed it was for Dangote Cement Factories. In fact at a time that of Kaduna Refinery was so exclusive to Dangote that no other marketer was loaded. Every other marketer was referred to Port Harcourt Refinery.
You want to know the sponsors of Dangote Refinery, Go to Kogi State and inquire how many trucks of Coal Dangote moves out of Kogi State everyday, minimum of 200 trucks daily without even paying royalty to the State or Federal Government. Are we not aware that Coal can be an alternative to Petroleum and that through coal liquefaction or coal pyrolysis you can derive various Petroleum products such as Diesel, Gasoline (petrol), LPG and other Petroleum products?
You want to know how Dangote Refinery was funded, go and find out how he petitioned President Goodluck Jonathan as soon as President Yardua died against his competitors in the Cement business like Ibeto, Madewell cement, Bua Cement and others that represented Licensees from the six geopolitical zones. His petition caused the withdrawal of two Licenses from the 6 companies; the Bagged cement and the Bulk cement import licenses leaving them with only the Backward Integration Licence only after he had used the same Federal Government to acquire cement factories even at that he was still importing and others were not allowed. As a matter of fact, the other Licensees lost their fortune as some were still offloading cement at their various jetties when Nigerian customs pounced on them never to bring the Cement into the Country but to ship it back to their countries of origin. This was when the competitors had succeeded to bring down the cost of cement to less than N800 per 50kg bag and Dangote couldn’t compete and wanted to monopolize the cement business at all cost.
You want to know how the Dangote Refinery was funded, go see how he petitioned the Federal Government against the few manufacturers of cement over importation of Clinker which is a major Raw material for cement production the moment he built his Clinker factory at Obajana Kogi State and the Federal Government jacked up the import duty on clinker from 10% to 50% causing those that were managing to compete with him to shutdown their cement factories.
You want to know how Dangote Refinery was financed, go and ask Federal Government how much Dangote realized when they shut the land boarders against every other importer and exporter during Covid 19 lockdown but allowed only Dangote to use the Land boarders.
Finally you want to know how Dangote Refinery is funded? Go and ask the Governor of Kogi State why he had to fall out with Dangote, that for 10 years of Dangote operation globally, Dangote made over 7 trillion Naira out of which over 5 Trillion Naira alone was from his establishments in Kogi State.
You still want to know how Dangote Refinery was funded? Nigerians funded Dangote Refinery without knowing it.
Please let us continue to share.
IS TIME FOR RENEWED HOPE.