The third way for construction.

Author:Ford, Neil
Position:CONSTRUCTION IN AFRICA
 
FREE EXCERPT

Not all project developers face a stark choice between African and foreign construction companies, as one of Africa's biggest construction companies has opted to form an alliance with a leading Chinese firm.

Nigeria's Dangote Group signed a deal in May with Sinoma International Engineering Company to jointly develop 10 new cement plants across the African continent, including in Cameroon, Congo-Brazzaville, Ethiopia, Gabon, Liberia, Sierra Leone, South Africa, Tanzania and Nigeria itself. Dangote is already active in 14 African markets, mainly as a result of its own organic growth. Devakumar Edwin, the group executive director of business development at Dangote, said: "When all the projects are completed in 30 months, the Ethiopia, Tanzania and Gabon plants will be producing 1.5m tonnes of cement each, while South Africa, Obajana and the two plants in Ibese, Ogun State, will generate 3m tonnes each. The Cameroon blending plant is also to produce 1.5m tonnes."

Total development costs are put at $3.9bn. Construction of the first plant is due to begin in July, with new capacity added gradually over the next three years.

In late May, Dangote bundled all of its cement interests, including Benue Cement Company and the Obajana Cement Plant, into a single subsidiary, Dangote Cement, which listed on the Nigerian Stock Exchange last October as one of the country's biggest companies.

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The firm already controls more than 50% of the Nigerian market and now looks set to expand on its dominant position as the building boom takes off in the West African giant's main cities. Dangote president and founder Aliko Dangote says that he wanted to create "an African champion that can compete with the largest cement companies in the world".

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He added: "The transfer of the cement interests of the Dangote Group to Dangote Cement will result in the diversification of the company's production and revenue profile from a wholly domestic operation...

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