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Eko o ni baje
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Discussion Starter · #1 ·
Dangote Cement becomes Nigeria's largest listed firm

October 26, 2010

Nigerian industrialist Aliko Dangote completed the $14 billion listing of his cement business on Tuesday, lifting the capitalization of sub-Saharan Africa's number two stock market by a third.
Dangote Cement listed 15.5 billion shares at 135 naira after a merger this month with local rival Benue Cement, making it the country's leading cement maker and the biggest company ever to list on the Nigerian stock exchange.
Dangote, a tycoon ranked by Forbes as Nigeria's richest man, said he wanted "to create an African champion that can compete with the largest cement companies in the world".


The billionaire held majority stakes in Benue Cement and Dangote Cement through his holding company Dangote Industries, meaning the free float of the listed entity was initially just 4.1 percent, below the regulator's 25 percent minimum.

He sold $154 million worth of shares to bring the free float to 5.2 percent.
Dangote Cement executives have said the firm plans to sell a further 20 percent -- worth $2.8 billion based on the listing price -- in a global offer over the next 18 months, probably in London.

Listing broker Afrinvest said 25 percent of the shares were theoretically on offer in Nigeria, but the local market, whose capitalisation was just over 6 trillion naira before the listing, was unlikely to have the capacity to buy that amount.

"Because the market is not likely to absorb all of that quantity, the (stock exchange) council has given a special dispensation to sell the remainder over the next two years," Afrinvest Chief Executive Godwin Obaseki said.
The shares were Nigeria's most heavily traded on Tuesday, despite listing less than half an hour before the market closed. They ended flat at 135 naira and accounted for some 40 percent of total volume, with more than 196 million traded.

GROWTH PLANS

Dangote is Nigeria's leading industrialists, with business interests including listed flour and sugar companies.
He is setting up cement plants and import terminals around Africa including in Ethiopia, Ghana, Ivory Coast, Senegal and Zambia, and aims to produce 46 million tonnes of cement a year on the continent by 2015, 30 million of it in Nigeria.

Dangote told reporters he planned to transfer all his cement assets outside Nigeria -- currently owned by Dangote Industries – into Dangote Cement by the first quarter of next year.

The aim of the merger with Benue was to allow Dangote's cement operations better access to financing, as well as consolidating supply and distribution chains, reducing costs and helping increase cement production more quickly.

"The listing appears to have attracted significant interest from many investors. This, in addition to its low free float, should serve as a catalyst for the stock in the short term," Stanbic IBTC, said, setting a 12-month target price of 170.50 naira and a "buy" recommendation.
The brokerage said the company was attractively valued at 7.9 times 2012 earnings, compared with a ratio of 9 for Nigerian peers
 

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Can someone call him up and tell him to hurry up on his business in Ethiopia? We need these cement plants immediately.

Why wouldn't this listing be a success?
 

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Eko o ni baje
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Discussion Starter · #5 ·
Can someone call him up and tell him to hurry up on his business in Ethiopia? We need these cement plants immediately.

Why wouldn't this listing be a success?
Popa the usual hata was arguing that the stock was too expensive

However he fails to realize that Africa is seriously deficient in infrastructure and the growth in construction on the continent for the next 10yrs will be crazy

Moreover the average cement plant in the world today is 20yr old,while dangote is building brand new(greenfield) plants with lower energy use and better efficiency
 

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I read in a senegalese newspaper that Dangote was ready to heavily invest or already invested the senegalese cement market.
 

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Discussion Starter · #7 ·

October 26, 2010

Dangote Cement, whose merger with Benue Cement Co. makes it Africa's biggest producer of the building material by capacity, plans to raise capacity more than fivefold by 2015 through expansion amid a construction boom in Africa. Earlier I caught up with Dangote Group President and chairman, Aliko Dangote on his visit before the listing Dangote Cement on the Nigerian Stock Exhange.
 

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Discussion Starter · #8 ·
Can someone call him up and tell him to hurry up on his business in Ethiopia? We need these cement plants immediately.

Why wouldn't this listing be a success?
watch the above video. . i believe all the African plants will be in place by latest 2015
 

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You know these type of "personalised" threads arent allowed.

Moderators shut or move this to the economic thread.

I think if you remember correctly- i painted one of two scenarios

1) the NSE realise that its over valued

2) the offering goes through and the "real" value of the shares will be realised eventually.

If you believe that a company that makes most of its money from 3 cement factories, can make up 8% of Nigerias GDP, then.....:)
 

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Eko o ni baje
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Discussion Starter · #15 ·
You know these type of "personalised" threads arent allowed.

Moderators shut or move this to the economic thread.

I think if you remember correctly- i painted one of two scenarios

1) the NSE realise that its over valued

2) the offering goes through and the "real" value of the shares will be realised eventually.

If you believe that a company that makes most of its money from 3 cement factories, can make up 8% of Nigerias GDP, then.....:)
Haha. . .i see u are already running to mods for help

anyway u should know that the worth or current stock price of a company is equivalent to the total future expected earnings over the lifetime of the company. . thats how stocks are valued

Further more this company is ramping up production to 46million Metric tonnes by 2015. . .
it is much cheaper and has a higher ROE. .when compared to its peers like Lafarge Nigeria which is listed on the same stock exchange

Next time try know a little about how stocks work before u start mouthing off. . .

and lots of companies in south Africa have valuations a third of the countries GDP. . thats an irrelevant point,especially when dangote is a continent wide company and not just a Nigerian one
 

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Discussion Starter · #16 ·
For those who are financial freaks like me

Heres a detailed Equity research on the new Dangote Cement company

Pls pay particular attention to page 37.. . .where it compares its valuation to peers around the world

see that the company has superior financial metrics

and is actually undervalued at these prices. . .click download in link below

http://www.proshareng.com/reports/view.php?id=2962
 

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Ah, paddy.

Like I said, we will see........

8% of GDP :lol:

But I would LOVE to be proved wrong in any case. Its to the detriment of SS Africa that they we lack industrial giants. Contrary to what you think, Nigeria wont develop on the back of telecomms and banking- manufacturing is imperative
 
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