Business

Dangote Lauds African Banks, Repays $2.4B of Refinery Loans Despite Challenges

Published

4 months ago

June 13, 2024

Aliko Dangote, Africa’s richest person and founder of the Dangote Group, announced that he has repaid $2.4 billion of the $5.5 billion borrowed to construct his $19 billion refinery near Lagos.

This disclosure was made at the Afreximbank Annual Meetings (AAN) and AfriCaribbean Trade & Investment Forum, where Dangote praised the crucial support from African financial institutions amidst numerous challenges and sabotage attempts.

Speaking to an audience of international financiers and business leaders, Dangote revealed that various entities, both local and foreign, sought to derail the 650,000 barrels per day facility.

“Many thought the project would fail,” he said, highlighting the skepticism surrounding the ambitious venture. Despite these hurdles, Dangote credited the Afreximbank and Nigeria’s Access Bank for their unwavering support, emphasizing that the project would not have succeeded without them.

He elaborated on the challenges faced, noting that foreign banks were often unsupportive, with some even attempting to push the project into default during the COVID-19 pandemic.

“If I had raised the idea of international project financing, they would have shut it down, asking for my great-grandmother’s birth certificate,” Dangote remarked, criticizing the stringent and often discouraging conditions set by international financial institutions.

Dangote underscored the importance of African financial institutions in the continent’s industrialization, stating, “Without banks like African Finance Corporation (AFC) and Afreximbank, it would be difficult to industrialize Africa. They understand the challenges and issues unique to our continent.”

Despite the adversity, Dangote proudly announced significant progress in loan repayment. “We borrowed just over $5.5 billion. We’ve paid interest and some principal, totaling about $2.4 billion. Now, only $2.7 billion remains. We’ve done very well for a project of this magnitude,” he stated.

Addressing concerns about receiving enough crude oil for the refinery, Dangote acknowledged ongoing resistance from established players in the oil industry.

“Those who had access to easy money for decades don’t want to lose their grip. They fight back, but these challenges are temporary. We will overcome them,” he assured.

Dangote also highlighted the strategic importance of the refinery for Nigeria and the broader sub-Saharan region.

“Africa must produce what it consumes. We can no longer rely on the West. During the COVID period, some international banks hoped to see us default. Thanks to banks like Afreximbank, that didn’t happen.”

Furthermore, he revealed that 25% of Dangote’s fertilizer production is now exported to the US, and the company is poised to meet the Caribbean’s urea needs.

He emphasized the refinery’s role in securing Nigeria’s energy future, noting that the facility will act as the country’s strategic reserve for petroleum products.

With eyes set on future ventures, Dangote announced plans to enter the steel industry. “We aim to ensure every piece of steel we use comes from Nigeria. No foreigner will make our continent great; it must be driven by domestic investment,” he proclaimed.

In a testament to the Dangote Group’s self-sufficiency, he revealed that the company produces about 1,500 megawatts of power for its operations, bypassing the national grid and its limitations.

In closing, Dangote reflected on his journey, acknowledging the continuous battle against powerful adversaries but expressing confidence in ultimate victory.

“The fight is ongoing, but with the support of our people and government, we will prevail,” he affirmed.

As Africa’s industrial landscape continues to evolve, Dangote’s story serves as a beacon of resilience and a call to action for local investment and self-reliance.

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Samed Olukoya

Is the CEO and Founder of Investors King Limited. He is a seasoned foreign exchange research analyst and a published author on Yahoo Finance, Business Insider, Nasdaq, Entrepreneur.com, Investorplace, and other prominent platforms. With over two decades of experience in global financial markets, Olukoya is well-recognized in the industry.

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Business

Presidency Proposes NIMASA AND NPA Charge in Naira to Strengthen Currency

Published

13 hours ago

September 27, 2024

Yetunde Olugbenga

On Wednesday, the federal government of Nigeria proposed the implementation of the Naira for transactions to reduce pressure on the foreign exchange (FX) market and to strengthen the Naira against foreign currencies.

This proposal was declared by the Special Adviser to the President on Information and Strategy, Bayo Onanuga, who spoke on Wednesday during a press briefing at the state house in Abuja.

It could be recalled that Naira has significantly depreciated from N471.67 per USD to N1667.42 per USD in the official market as of Wednesday. Therefore, as part of the government’s effort to reduce the demand for dollars, the federal government reiterated that on October 1, the sale of crude oil in Naira to the Dangote refinery, and other local refineries would commence.

According to Onanuga, the federal government will implement policies that would force the Nigerian Maritime Administration and Safety Agency (NIMASA) and the Nigerian Port Authority (NPA) to transact in Naira.

“The second one has to do with the operating laws guiding NIMASA and Nigerian Port Authority (NPA). The amendment under that in the economic stabilisation bills is that all their fees, charges, levies, fines, and other monies accruing to them and payable to those agencies will now be paid in Naira at the applicable exchange rate.” He said.

He added that this is part of the economic stabilisation bills (ESBs) to be presented by President Bola Tinubu to the national assembly.

“Hitherto, those agencies were charging in dollars but now collect it in Naira. This government wants to put a lot of emphasis on our national currency instead of everything being dollarised in our economy.”

Merger and Acquisition

Flour Mills Receives Regulatory Approval for Minority Shareholder Buyout

Published

2 days ago

September 26, 2024

Bassey Marshall

The Flour Mills of Nigeria Plc (FMN) has perfected plans to buy out minority shareholders to focus on strengthening its position as the future of African food businesses.

Boye Olusanya, the group managing director, stated that the company has received approval from the Nigerian Exchange Limited (NGX) and the Securities and Exchange Commission (SEC) to proceed with the purchase.

FMN disclosed on Tuesday that the buyout would be executed through a scheme of arrangement, supervised by relevant regulatory bodies.

According to Olusanya, this move aligns with FMN’s goal to become the leading Pan-African food business, improving its ability to innovate and grow, while focusing on long-term value for stakeholders.

He said the buyout would enhance FMN’s operational efficiency and decision-making agility.

The company plans to apply to the Federal High Court for approval to convene a shareholders’ meeting, where the resolution to buy out minority shareholders will be discussed.

Olusanya said the resolution would pass if at least 75% of shareholders, either in person or by proxy, approve it at the Court-Ordered Meeting (COM). FMN’s board has already recommended the offer to shareholders, citing the buyout’s potential advantages for innovation and sustainable growth.

Business

Weeks After Losing $1.1 Billion, BUA Announces Expansion

Published

2 days ago

September 25, 2024

Bassey Marshall

The Chairman and Chief Executive Officer of BUA Foods Plc, Abdul Samad Rabiu, has revealed plans to expand the pasta production unit of the company.

Investors King gathered that the planned expansion comes weeks after Nigeria’s second richest man experienced a $1.1 billion decline in his net worth in 90 days.

The depreciation in Rabiu’s wealth was largely attributed to the depreciation of the naira and fluctuations in equity values.

However, after signing an agreement with FAVA (Italy), one of the world’s leading pasta equipment manufacturing companies, BUA Foods renewed its planned expansion.

Rabiu announced the expansion in a statement signed on Wednesday by BUA Foods Director of Marketing and Corporate Communications, Adewunmi Desalu.

According to him, the planned expansion is aimed at assisting the government in battling the ongoing food shortage in the country.

He noted that the expansion will give room for growth, adding that the company will be able to introduce new innovations.

The statement read, “Our manufacturing capacity expansion will continue to enable us to extend the boundaries of what we can produce and deliver, supporting our nation’s development by providing solutions to ongoing food shortages.”

“In addition to producing more pasta, we’ll be able to introduce new innovations to support mixed volume growth, while consistently delivering the unrivalled product quality our customers expect.

“The additional 100,000 tonnes of grain storage capacity will enable us to meet the growing demand for our products while strengthening the backbone of our food processing operations by ensuring a reliable and consistent supply of raw materials.”