Dangote’s expansion: driving African capitalism

Lyal White (Centre for Dynamic Markets, Gordon Institute of Business Science, University of Pretoria, Johannesburg, South Africa)
Liezl Rees (Centre for Dynamic Markets, Gordon Institute of Business Science, University of Pretoria, Johannesburg, South Africa)
Emerald Emerging Markets Case Studies
ISSN: 2045-0621
Publication date: 23 May 2018

Case summary

Subject area

Doing business in Africa, strategy, leadership.

Study level/applicability

The case is intended for use in MBA and Executive Education courses in Strategy, Business in Africa and Leadership.

Case overview

This case study examines the growth of the Dangote Group in Nigeria and its ambitious expansion across Africa. Driven by the visionary leadership and energy of founder, President and CEO Aliko Dangote himself, the rise of the Dangote Group also represents the changing geopolitics of the African region. A true conglomerate, the company dominates every niche in which it operates. Best known for its cement, Dangote is also active in sectors as diverse as pasta, real estate and steel. It has expanded into the oil industry and is building a refinery in Nigeria, an oil-producing state that imports most of its fuel requirements because of inadequate refining capacity. The Dangote Group serves as an example of true African capitalism, representing the new and somewhat nuanced style of doing business in Africa, which involves undertaking capital intensive projects; using unique methods, management approaches, technologies and innovations; leveraging state connections for business advantage; and understanding the growing need for local partners or local content in new markets across the continent.

Expected learning outcomes

Students should gain insights into various business strategies in Africa, contextual leadership intelligence and the role of institutions when doing business in Africa.

Supplementary materials

Teaching Notes are available for educators only. Please contact your library to gain login details or email support@emeraldinsight.com to request teaching notes.

Subject code

CSS 11: Strategy.



White, L. and Rees, L. (2018), "Dangote’s expansion: driving African capitalism", Emerald Emerging Markets Case Studies, Vol. 8 No. 2. https://doi.org/10.1108/EEMCS-03-2017-0057 Download as .RIS

Publisher: Emerald Publishing Limited

Copyright © 2018, Emerald Publishing Limited

In April 2014, Nigeria became Africa’s largest economy after a rebasing shifted the gross domestic product (GDP) figure from $262bn to $510bn overnight. Aliko Dangote and his company, the Dangote Group, represent this “new Nigeria”. Although it has its roots in the old military-dominated Nigeria, its success has been in the modern democratic era. The company’s rise is a direct result of growth and large-scale development within its home country, and its vision and ambitious expansion across the African continent demonstrate the awakening of a new corporate power.

Dangote brings scale and well-financed projects to countries in Africa beyond Nigeria. It has disrupted the status quo in traditional sectors in these markets by bringing increased competition to well-established players in the cement industry and at times served as an agent of development through job creation and increased productivity. Aliko Dangote himself has driven the engagement and expansion activities of the group, supported by the Nigerian government. Together, they have aligned the company’s activities to Nigeria’s strengths in key industries and needs of the country.

In 2017, as Aliko Dangote contemplated the modernization of Nigeria, he was struck by the alignment between his company and home country. If he was to grow the Dangote Group and establish long-term success, then he wondered if the Group was prepared for the pursuit of even greater success or was lined up for failure by over extending itself. Would the company’s continued growth and success lie in new markets and new sectors? Was the company ready to make critical decisions vis-à-vis its areas of focus, its geographical footprint and the corporatization of the company, especially in terms of decision-making in the area of strategy and day-to-day operations?

The rise of Nigeria

As a result of the failure of Nigeria’s former military rulers to diversify the economy and reduce its dependence on the capital-intensive oil sector, which still provided 95 per cent of foreign exchange earnings and about 80 per cent of budgetary revenues, Nigeria was an archetypal single-commodity economy until 2008.

In 2008, the government began showing the political will to implement market-oriented reforms advocated by the International Monetary Fund (IMF). These included the modernization of the banking system, curbing inflation by blocking excessive wage demands, and resolving domestic disputes over the distribution of earnings from the oil industry to the country’s 36 states. However, many challenges remained. Infrastructural weaknesses in the power sector, for example, remained a serious impediment to growth. Although the government strived for stronger public-private partnerships for generating electricity and building roads, as well as improving fiscal management and increasing transparency, it battled to reform a petroleum-based economy where revenues were being squandered as a result of corruption and mismanagement. In addition to these economic and structural challenges, Nigeria was still experiencing longstanding ethnic and religious tensions.

Despite these challenges, Nigeria, richly endowed with raw materials and entrepreneurial vigor, had the key ingredients to be a major African industrial powerhouse. However, successive governments failed to exploit the country’s natural advantages to industrialize. During the 2000s a strong push for greater industrial activity through targeted programs, use of trade instruments to encourage industry and local content initiatives began. This drive has been assisted by the Nigerian Ministry of Trade and Industry, which sees rapid industrialization and private sector development as being key to sustainable growth.

In 2016, low global crude oil prices and output, and the resulting shortage of foreign currency, plunged the Nigerian economy into recession for the first time in more than two decades. In response to the economic crisis, the Minister for Budget and National Planning, Udoma Udo Udoma, announced the Economic Recovery and Growth Plan (ERGP) 2017-2020. The focus of the plan is on asset divestment, stable oil production (ultimately with local refinement) and much-needed expansion of economic infrastructure to combat the economic crisis, restore growth and bring about sustained inclusive growth in Africa’s largest economy (Sonyini and Francis, 2016).

Aliko Dangote

I can remember when I was in primary school, I would go and buy cartons of sweets (sugar boxes) and I would start selling them just to make money. I was so interested in business, even at that time. – Aliko Dangote (Pan African Visions, 2014)

Aliko Dangote was born on April 10, 1957, in Kano, northern Nigeria to the wealthy Dantata family. He later studied business at Egypt’s Al-Azhar University. After graduating in 1977, he moved to Lagos where he entered the trading business. His grandfather, the late Alhaji Sanusi Dantata, gave him a small loan of NGN500 000 ($3,080) to start his own business trading in soft commodities and building supplies such as sugar and cement. This was at a time of relative economic isolation and high dependency on oil in Nigeria. But despite the constraints in the Nigerian environment, Dangote’s businesses grew and he was able to incorporate two companies within four years. This is the origin of the Dangote Group as it exists today.

In the 1980s and 1990s, Dangote began exporting flour, salt and sugar across West Africa. The return of civilian rule in 1999 brought a doubling of economic growth in Nigeria along with an open door to the global economy. This environment, coupled with a strong work ethic and family connections across Nigeria, laid the foundation for the rise of the Dangote name.

The Dangote Group is intricately linked to Aliko’s belief in the potential of Nigeria and its people. He is often described as being generous to different political parties, religious groups and cultural institutions, as well as being a religious, resilient, nonpartisan, determined and passionate man (Vanguard, 2014). Among other things, these attributes have enabled him to maintain, balance and enhance influential relationships within Nigeria and in other countries. One of his key social imperatives has been to provide employment to graduates and school leavers in the areas of transportation, packaging and security in his companies. The key principles of determination and passion are associated with his leadership style.

Aliko’s life purpose is to be remembered as ‘Africa’s greatest industrialist”; his strategy of building high-quality brands with a strong distribution network; his drive towards market domination in all areas of the Group through hard work and persistence; and finally, his determination and passion as an entrepreneur (Fowler, 2011) (See Exhibit 3 for a list of Dangote’s 10 rules for success).

Time and Forbes magazines recognized Aliko Dangote as one of the world’s most influential people in 2014 and 2016, respectively (Ewalt, 2016). As of 2017 his net worth was said to be $12.4bn, making him the 67th richest man in the world and the richest man in Africa (Nsehe, 2016). He was also awarded the “Grand Commander of the Order of the Niger” in 2011. As Nigeria’s second highest national honor, it was the first time the award was given to an individual outside of government (Nsehe, 2016).

Let us not be naive: A lot of everything that happens in life depends on connections. Your fortunes depend on who will be able to open the door for you. (Aliko Dangote, 2012; Dixon, 2012)

Aliko has been unapologetic about the close relationships he has formed with governments. Critics believe he has used his political relationships and connections to pave the way for his company’s continued growth and success, and, in so doing, has been able to systematically marginalize his competitors.

In 2003, he openly funded former president Olusegun Obasanjo’s re-election campaign and is said to have funded various political parties in subsequent elections. This strategy has paid off. For example, in 2016, while Nigeria struggled with recession, the government agreed to give Dangote a preferential foreign exchange rate for the building of his $17bn oil refinery outside Lagos. The Central Bank of Nigeria offered him the official exchange rate for the project – a concession given to companies believed to be strategic to Nigeria’s interests, but rarely ever offered. This allowed the Dangote Group to buy one dollar at the then official rate of 199 naira, well below the market rate of around 300 naira at the time (Akande, 2016).

According to a Wikileaks (2004) document dated 7 March, 2005, the Dangote Group “at one time or another held exclusive import rights in sugar, cement, and rice using such advantages to do volume business and undercut competitors”. The report went on to say the “direction of GON [Government of Nigeria] trade barriers also suggests preferential treatment” and that “high tariffs or outright bans on imported items favour the Group in nearly all areas in which they do business including wheat flour, cement, certain textiles, sugar and pasta”. It is important to note however that it is common practice for countries to attract major foreign direct investors, such as Dangote, to invest in their country by offering attractive investment incentives.

However, Dangote has not been staunchly partisan in his support for and relationships with leaders and political parties. He has always maintained and openly declared that close relations with government are an important part of doing business in Africa, stating in an interview with The Economist in 2013: “If you want to do business, you have to foster a good relationship with the Government of the day. If you don’t, how do you expect the government to listen to your complaints?” (Cementing a Fortune, 2012).

The rise of Dangote

In 10 or 15 years, Nigeria will represent no more than 40 per cent of our turnover. We try to diversify ourselves, both on geographical and sectoral plans. But there are so many opportunities here in Nigeria that we sometimes have difficulty in getting over. But when you try to increase, it is necessary to do it first “at home” before going anywhere else. – (Aliko Dangote, 2014; Africa Top Success, 2014).

The rise of Dangote has been in tandem with the emergence of modern Nigeria, with the Dangote story closely linked to government support and progressive policies that helped develop the company in its home market. By 2017, Dangote had become one of Nigeria’s most diversified businesses, and the largest manufacturing conglomerate, in Sub-Saharan Africa.

In the early 1990s, the Group grew into one of the largest trading conglomerates operating in the country. By 1999, Dangote had identified a gap in a market where imports constituted the vast majority of consumer goods available in Nigeria. The Group, thus, transitioned from a trading-based business into a fully-fledged manufacturing operation by initially focusing on the construction of flour mills, a sugar refinery and a pasta factory. By 2017, the company employed over 20 000 people and was the largest industrial conglomerate in West Africa.

Among the myriad components of the Dangote business group, the largest revenue earner is the cement business – Dangote Cement. Dangote Cement PLC listed on the Nigerian Stock Exchange in October 2010, after the Group bought the state-owned Kogi plant in 2002 and began building the Obajana cement plant – currently the largest in Sub-Saharan Africa – which started operating in 2007. As of 2016, about 80 per cent of his conglomerate’s revenue came from this business which was expected to realize a 40 per cent increase in profits in 2017 and supply about 53 per cent of the cement market in Nigeria (Cassell, 2015).

Dangote also owns the world’s second-largest sugar refinery. Together, all of his publicly traded companies made up 30 per cent of the market capitalization of the Nigerian Stock Exchange in 2016 (Dangote Cement, 2016).

Nigeria, the cement sweet spot

If you give me today $5 billion, I will not invest any abroad; I will invest everything here in Nigeria. Let us put our heads together and work. – (Aliko Dangote, 2011; African Success, 2016).

The rise of Dangote Cement, both in revenue and geographical prominence, is the result of a decisive business strategy undertaken by the company: A recognition of, and investment in, sectors with a strategic competitive advantage both domestically and in new markets.

Historically, the African cement market was dominated by a handful of players; with the global majors carrying a majority shareholding in key plants in some of the more established African markets, alongside two African heavyweights, Pretoria Portland Cement (PPC) of South Africa and Dangote Cement.

As of 2017 Nigeria, as a country, is both the principal supplier and consumer of cement in West Africa. With domestic production capacity of about 41.3 million tonnes per annum – dominated by Dangote Cement which has around 70 per cent of the local market – demand hovers at about 22 million tonnes (Proshare, 2016). This has allowed for a surplus to be exported to regional markets such as Ghana. With few lime deposits between Nigeria and Senegal, Nigeria has been described as a cement industry “sweet-spot”, likely to continue to dominate West Africa’s supply and demand, becoming a leading global supplier in the future (Exclusive Business Magazine, 2016).

The cement sector in Nigeria has favored Dangote’s own growth goals because of the large population, rapid Urbanization and an investment environment that offered five-year tax breaks for new factories and export incentives and is an ideal location for exports to the Economic Community of West African States (ECOWAS) bloc. At an operational level, the country has adequate rich limestone deposits and resources, attractive cement pricing and an availability of low-cost natural gas to power plants.

By 2016, Dangote Cement operated three integrated plants in Nigeria. As the market leader in Nigeria, Africa’s most profitable cement market, the company has a low-cost base from which to reach the rest of the continent and existing and planned projects in 15 locations across Africa, as well as Nepal. At the end of 2016, the company’s production, grinding and import capacity across Africa totaled almost 45 million tonnes from eight countries: Nigeria, Senegal, Zambia, Tanzania, Ethiopia, South Africa, Ghana and Cameroon. Dangote’s target of reaching a capacity of 77 million tonnes by 2019 has been scaled back because of currency controls in Nigeria. As of 2017, the company expects to reach 49 million tonnes per annum by 2019[1].

Dangote’s underpinning competitive strategy

Aliko Dangote has said the Group’s objective is to become a $100bn company by market capitalization by 2020 (CNBC Africa, 2016). Given the volatility of the Nigerian currency, the naira and its rapid depreciation because of falling oil prices in 2015, the company has recognized this will be an impossible achievement given most of its assets are held in local currency.

The company continues to aim to be the leader in both Africa and other emerging markets in a selected range of businesses (particularly cement, sugar, fertilizers and oil). Dangote Cement is also seeking a listing on the London Stock Exchange, which would offer a range of capital raising alternatives to the company as it expands. The Group has been able to keep its debt low by creating its own funding streams to finance expansion projects with minimal risk.

However, a number of factors have affected Dangote’s growth, such as poor infrastructure, corruption in Nigeria and dated internal systems. It has, therefore, adopted various measures that benefit not only its own growth, but address challenges faced by the broader Nigerian economy as well. Examples of this include a strategic agreement with General Electric to collaborate on providing power, as well as transportation, oil and gas projects which address infrastructural gaps in the country. In addition, the under-investment in internal systems and support functions has become a key focus for the company to address as it builds scale, standardization and shared services across the Group.

While Dangote Cement has adopted extensive expansion plans for operations on the rest of the continent, other subsidiaries of the group have focused their growth strategy on the domestic market. Dangote Sugar, for example, has led the way in the federal government’s drive for backward integration in agriculture, to enable the company to meet domestic consumption demands and increase employment. At the same, this subsidiary plans to expand to Liberia, Mauritania and Senegal.

Other areas of local investment are the completion of a $17bn petrochemical and fertilizer plant near Lagos, with the capacity to produce 650,000 barrels per day upon commencing operations in 2019. This plant will create almost 300 000 direct and indirect jobs and produce 100 per cent of the country’s fuel requirements, with spare capacity for export. The fertilizer plant will enable farmers to use locally produced products instead of imported products (Premium Times, 2017).

In January 2017, Dangote established a $100mn truck assembly plant in Lagos in partnership with the Chinese firm, Sinotruk. Dangote has a 60 per cent share of the plant and Sinotruck the remaining 40 per cent. This investment, which will produce the largest fleet of trucks operating in Africa, will result in the production of more than 10 000 trucks annually and is geared for the widespread distribution of Dangote products across the continent. The plant, located in Ikeja, will not only curb the company’s reliance on imported trucks to distribute its products but is expected to create 3 000 direct jobs once fully operational. After meeting the local truck demand, Dangote plans to export vehicles to neighboring countries to generate foreign exchange for Nigeria (Premium Times, 2017).

These developments show similarities with the growth path adopted for Dangote Cement: First, establishing operations to meet domestic consumption and demand, while at the same time, addressing inhibitors to growth for the company, sector and broader Nigerian economy; and second, establishing a presence for the Dangote name in markets outside of Nigeria.

Dangote: Market disruptor or destabilizer?

They didn’t believe us at all. They thought I was one of these ‘Nigerian 4-1-9′ scammers who try to go and scheme people out of their money,” Dangote says. “Or just one of these clever Nigerians who would come and be lying to them – (Aliko Dangote describing a visit to Tanzania in 1996, Okeowo, 2013).

Dangote epitomizes the notion of “Africans investing in Africa” with a business strategy focusing on backward integration to replace imports with local production in critical areas of need, with the aim of making Nigeria self-sufficient in commodities such as cement, sugar and flour.

Dangote also represents the changing geopolitical dynamics in Africa and the shift in economic power with the rise of Nigeria as the largest economy on the continent in 2014, and with that, the rise of new champions.

The Dangote Group describes itself as an unashamed market disruptor, where it sees its role – over and above supplying cement – as creating jobs and disrupting prices from their current astronomical levels seen in many undersupplied African markets. The Group and its subsidiaries are typically perceived as contributors to development through the jobs they have created and the industrialization and growth of the economies in which they have invested. Cement is, after all, one of the great economic multipliers which creates growth and opportunities across the entire economic spectrum. This is a true representation of African-styled capitalism.

While Dangote sees itself as a market disruptor, its competitors consider the company to be a market destabilizer. Leveraging close political relationships and its economic might to compete, Dangote has often secured preferential trade and operating agreements in several African markets, marginalizing competitors to its own advantage.

For example, when Dangote opened a cement plant in Tanzania in 2015, the government at the time gave the company generous tax incentives in order to entice Dangote to invest in the country. These included tax breaks for diesel imports and allowing Dangote to import its own coal directly. In late 2016, Dangote’s Tanzanian factory suspended operations after the Ministry of Energy and Minerals reduced some of these incentives, following investment requests worth $9bn by three local cement producers requesting similar incentives and concessions. While the company attributed the halt in production to “technical issues”, it was widely viewed as a move to force the government to the negotiating table (Olingo, 2016). A deal was eventually struck: The government would supply the plant with natural gas at a “reasonable” tariff, thus eliminating middlemen (Olingo, 2016). Operations resumed but some reputational and diplomatic damage was done.

In October 2016, the Cement Manufacturers Association of Ghana (CMAG), representing local cement producers, lobbied the Ghanaian government for a ban on imports of cement from Dangote based on “unfair trade practices” (Global Cement, 2016). According to local manufacturers, Dangote Cement retailed for less in Ghana than it did in Nigeria, where it was manufactured. They attributed this to an export subsidy of 30 per cent on bagged cement from Nigeria (Daily Guide, 2016). Managing Director for Dangote Cement Ghana, Tor Nygard, dismissed all accusations of dumping. According to Carl Franklin, Head of Investor Relations for Dangote Cement, “the company mostly imports into Ghana from the Far East, not Nigeria. However, there are plans to import much more from Nigeria. Ghana needs to import cement or clinker because it lacks limestone in sufficient quantity for manufacturing”[2].

The expansion plan

By 2017, the Dangote Group dominated the market in all its operating sectors, both in terms of manufacturing and exports to other African countries. Dangote Cement opened facilities in seven other new African markets in the years prior, including Senegal, South Africa, Cameroon and Ghana (importation), Ethiopia, Zambia and Tanzania. Plans are underway to build integrated production factories in the Central African Republic of Congo, Kenya and Zimbabwe as well as import or grinding facilities in Sierra Leone and Liberia in the next two to five years (Exhibits 1 and 2).

West Africa, predominantly an export market for Nigerian cement, meant Dangote’s investments have focused on export terminals in Nigeria along with import terminals and grinding plants in selected countries like Ghana and Sierra Leone.

The strategy across East and Southern Africa has been to enter markets with new, highly efficient cement plants. These are more competitive than older factories that are more expensive to maintain and produce. Investments in these regions have, therefore, taken the form of large-scale capital-intensive integrated plants. Those in Ethiopia, Kenya, South Sudan and Tanzania ranged between $300mn to $470mn for each plant. By 2016, East Africa had attracted roughly $1.7bn of Dangote investment, South Africa $326mn and Zambia $300mn. By 2017, the South African operation had a production capacity of 2.5 million tonnes of cement per annum, while the Zambian plant had a capacity of 1.5 million tonnes[3].

The South African operation is a prime example of the company’s strategy in the region: New technology from the company is much more efficient than that of the older, more established cement plants in South Africa, and this has allowed Dangote to compete on cost and service; while servicing inland locations and delivering bagged and bulk cement to 95 per cent of the region. In 2010, Dangote Cement increased its stake in South Africa’s Sephaku Cement from 19.76 to 64 per cent. At the time, this transaction was the largest ever foreign direct investment (FDI) by an African company into South Africa (Allison, 2014).

Dangote’s entry strategies into other African markets have made use of political diplomacy, accompanying state visits by the Nigerian president and large capital outlays into new Greenfield operations. Dangote’s use of political leverage and diplomacy to accelerate expansion is not unique to how business is conducted in Africa. Engagement with, and even working with government and policy-makers, is part of the practice of business in Africa.

Dangote’s expansion has been driven directly by the top leadership and by Aliko Dangote himself, who has a hands-on approach to engagement and implementation. The Nigerian government has been a great supporter of Dangote as a primary exporter and investor across the continent.

Ibeto, the last remaining importer of cement into Nigeria, has maintained they have not been granted the same preferences as Dangote. Even though they were required to move from being an importer of cement to a self-sufficient manufacturer – phasing out imports by 2017 – the preferences Dangote was given during its transition from importer, to local producer, to exporter no longer applied. In short, they maintain that they have been unable to compete on an even playing field given a shift in policy[4].

Dangote Cement has taken advantage of improving political stability and economic transformation driving growth in Sub-Saharan Africa, and the accelerated consumption of cement as a result of infrastructure investment and urbanization. The company has made use of its distinct advantage over other companies in being able to service high CAPEX requirements in the sector, with little debt, compared to its competitors. One of the key operational contributors to the success of Dangote Cement’s expansion in Africa has been the company’s ability to successfully incorporate sales and logistics services into its production capabilities. With the aim of widening its sales network points, Dangote Cement essentially “liberalised” its distribution by increasing its transport capabilities (such as the company’s $100mn investment in a truck assembly plant in Lagos) and widening its distribution network by taking on additional affiliated cement dealers.

Dangote’s expansion plans are widely admired for their scale and use of technology to advance the sectors in which the company operates. But the company has also been criticized for its lack of corporate professionalism and highly centralized approach to decision-making and communication, despite its size and spread. The company grew quickly into a pan-African operation and global brand, but as of 2017, has yet to corporatize fully which poses a number of challenges to maintaining growth, levels of efficiency and image – not to mention adhering to listing requirements for exchanges such as the London Stock Exchange.

Also, host countries and partners in Africa have shown a preference for negotiating directly with Aliko Dangote rather than his executive team. The magnate has, therefore, regularly and happily met with policy makers, heads of state and business partners across the continent. In a 2012 interview, he acknowledged the weakness of his corporate structure, suggesting a plan to loosen his control over the company as it moved towards listing on the London Stock Exchange, while focusing on cement, petrochemicals, energy and mining as priority sectors (Rice, 2012).

A premium listing will require a review of corporate governance for Dangote Cement. To this end, Aliko Dangote has stated that he would give up his role as chairman to meet necessary requirements. As of January 2017, however, he remains chairman of the company.

Will his vision for the company and its place in Nigeria’s development continue at its current pace without him at the helm? This is a key question in the next phase of the Dangote evolution.

The way forward

You must have a vision but you must have a plan that would make you fulfil that vision. For us at Dangote, for instance, just conception and planning alone sometimes takes two years. You must also put in place processes of how to execute the plans – (Aliko Dangote; The Scoop Nigeria, 2013).

The overarching theme of Dangote’s rise as a company has been the coupling of its goals to that of Aliko Dangote’s vision, and the success of the Nigerian economy and the broader sub-Saharan Africa region.

Announcements in 2016 and 2017 suggested the company was investing in new industries that would support the supply chain for its existing operations. For example, gas and agriculture to support its cement and sugar operations. This again demonstrates Dangote’s response to Nigeria’s economic challenges and the need for self-sufficiency where possible.

As Aliko Dangote considers the way forward for his companies, he must consider whether or not he will be the one making key decisions in years to come. Whether or not the Group can keep adding to its list of niche areas and markets served, and replicate the success of Dangote Cement, will also rest on its ability to decentralize decision-making powers and continue to build relationships with government.

Key questions and issues around Dangote and the changing environment in Africa are emerging. With new sectors and markets becoming part of the Dangote stable, can the expansion model adopted by Dangote Cement be replicated effectively by a new leadership and will they able to preserve Aliko Dangote’s vision for the Group along with relationships he has personally forged – many of which underpin current operations in Africa? With this in mind, how will the changing dynamics within the group, together with the changing environment in Africa, play out given the complexities surrounding the “Rising Africa” narrative? Finally, will other emerging African multinationals be able to replicate Dangote’s brand of “African capitalism” and level of competitiveness, or are other nuanced models likely to present themselves within this rapidly changing and diverse environment?



Comments from Carl Franklin, Head of Investor Relations at Dangote Cement in June, 2017.


Comments from Carl Franklin, Head of Investor Relations at Dangote Cement in June, 2017.


Those that are able to survive, such as international players like Lafarge, are companies with significant capital reserves.


Dangote Cement Group Presentation, June 2017.


Dangote Cement Group Presentation, June 2017.


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Figure E1

Figure E2

Exhibit 1. Dangote cement existing and planned operations

Figure E1

Exhibit 2. Dangote expected capacity additions 2016-2019

Figure E2

Exhibit 3. Summary of Dangote’s 10 rules for success[5]

  1. To be a good leader you have to be a good listener. There is no way you can make it as a person without a good team.

  2. Be consistent. When you have a business there might be hiccups here and there but it does not mean the business is not going to work. You have to work out how to work around the challenges.

  3. Ensure you have the right information. You need a lot of information at your fingertips which allows you to make the right decisions.

  4. Be focused as a person and dedicated to what you are doing. You should not take your business or job as something you must do, you must take it as part of your hobby. If it is part of your hobby, then you do it better.

  5. Think ahead and consolidate before continuing to expand. In business, what is good today might not be good tomorrow. If you diversify you must consolidate before you move on, then you cannot keep expanding. If you over expand, then it can cause a crisis.

  6. You have to have a vision. For an entrepreneur there are no boundaries. You need to have a vision and a mission in order to excel.

  7. We are a focused company, we do not go into things that we do not understand. Any business that I do not understand well, I do not do it at all.

  8. To be an entrepreneur and a visionary person you have to be very bold, you have to be ready to take calculated risks and you have to think big. If you think small, then you will always remain small in life.

  9. The way we operate as a company, we have a vision and a strategy of how we are going to achieve our strategy.

  10. If you want to be the next Dangote, then you have to have a very big heart; you have to take calculated risks. You have to be honest. Your name is very important; it is your most valuable asset.


Disclaimer. This case is written solely for educational purposes and is not intended to represent successful or unsuccessful managerial decision-making. The authors may have disguised names; financial and other recognizable information to protect confidentiality.

Corresponding author

Lyal White can be contacted at: whitel@gibs.co.za

About the authors

Professor Lyal White is Director at the Centre for Dynamic Markets, Gordon Institute of Business Science, University of Pretoria, Johannesburg, South Africa. Lyal White is the Director of the Centre for Dynamic Markets (CDM) at the Gordon Institute of Business Science (GIBS), University of Pretoria.

Liezl Rees is Manager at the Centre for Dynamic Markets, Gordon Institute of Business Science, University of Pretoria, Johannesburg, South Africa. Liezl Rees is the Manager of the CDM.