BRAND WATCH: DANGOTE 3X CEMENT
The Dangote Group is a diversified conglomerate, with its headquarters in Lagos, Nigeria, with interests across a range of sectors in Africa. Current interests include cement, sugar, flour, salt, pasta, beverages and real estate.
With a view to new developments, according to Forbes, in April 2014 he announced $9 billion in financing from a consortium of local and international lenders to construct a private petroleum refinery, fertilizer and steel, telecommunication and petrochemical complex in and outside Nigeria.
Dangote Cement is the largest cement production company in Africa and in Nigeria. A subsidiary of the Dangote Group, it is the largest company traded on the Nigerian Stock Exchange. In 2012, the company produced around 10 million metric tonnes of cement, with revenues of US$1.8 billion. As of 2013, Dangote Cement had a market capitalization of $15 billion. In 2012, Forbes Africa named Dangote Cement as one of the top five listed companies in West Africa.
With a market capitalization worth billions of dollars, the conglomerate has subsidiaries in Benin, Cameroon, Ghana, Togo, 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. Once it was completed in June 2013, as anticipated, the new plant was expected to have an annual output of 1.5 million metric tonnes of cement.
In Nigeria, Dangote is the largest cement producer with three plants and plans to expand in 13 other African countries. The company is a fully integrated quarry-to-depot producer with production capacity of 19.25mmtpa in Nigeria as at the end of 2012. The company plans to build a further 19mmtpa of production, grinding and import capacity across Africa, expected to be operational by the end of 2015.
Dangote Cement’s Obajana plant in Kogi state, Nigeria, is the largest in Sub-Saharan Africa with 10.25mmtpa capacity across three lines and a further 3mmtpa capacity currently being built. On February 9, 2012, the firm opened a $1 billion cement plant in Ibese, Ogun State. The facility is capable of producing 6 million metric tonnes of cement per year, raising the company’s total production by 40 percent at the time. The plant was installed by the Chinese construction and engineering firm Sinoma, and represents one of the largest non-oil investments in Nigeria. The company’s Gboko plant in Benue state has 3mmtpa capacity with an upgrade to 4mmtpa planned in 2013.
Dangote Cement Plc recently upgraded the quality of its cement to 42.5 grades; describing the development as a good response to the demands of the time.
The new name for the brand from the Dangote stable comes with “Xtra strength; ‘Xtra life and Xtra yield.”
Aliko Dangote, Group President, explained that the expansion strategies embarked upon by the management would culminate in an increase of an additional 9 million metric tonnes of cement capacity.
The Chairman vowed that the company would stop at nothing to expand because presently most neighboring countries are importing cement from Far East. And we are confident that Nigeria’s cement will prove more attractive than the imports, particularly within the 15 member ECOWAS states.”
To stabilize the price of cement and free the consumers from profiteering middlemen, Dangote, said that his company would intensify direct-to-consumer deliveries.
Insisting that his company has not increased the price of cement, he explained that though prices of most inputs into cement production has gone astronomically high but that his organization is committed to making the commodity available to consumers at the most reasonable price.
“We have not increased the prices of our product, we have embarked on an initiative to improve the standard of cement sold in Nigeria and our belief is that 42.5 strength cement is the most appropriate for general use now.
The Group Managing Director, Dangote Cement Plc, Mr. Devakumar Edwin said the launch by Dangote was to show the company’s commitment to the safety of human lives rather than maximizing profits alone in the country. He stated that building collapses in the nation were as a result of various factors including poor quality cement. “We have come with a superior product. It does not mean old products are bad,” he said. Edwin noted that the lifetime investment by Dangote was to further demonstrate the company’s effort to guard against unfortunate incidents of failure of buildings and the attendant loss of lives and property.
He said to contribute its quota towards checking the spate of building collapse in the country, “Dangote has stopped the production of the 32.5 lower cement grade,” saying as a corporate organization, it values human lives rather than just making money.
Dangote Cement PLC received approval and praises from the Standards Organisation of Nigeria (SON) to begin distribution of higher grade of cement into the Nigerian market.
According to the SON, an inspection of the company’s manufacturing equipment has been carried out across the nation and results show that the production processes have been upgraded to efficiently manufacture the 42.5 cement grade, which provides higher strength in building and construction.
SON made this declaration during Dangote’s pre-media launch of the newly-introduced cement grade, Dangote 3X cement, in Lagos.
The SON Director General, Dr. Joseph Odumodu, who was represented by an enforcement official of the agency, Mr. Adeoye Onipede, commended the move by Dangote to increase its value proposition to Nigerians with the new product and encouraged the company to keep abiding by the set manufacturing standards.
The Dangote 3x Cement is surely a brand to watch; some might say it is now the cement brand to beat.