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by Alexander Cain

Oprah Winfrey, Jay-Z, or BET founder Robert Johnson come to mind when thinking of some of the most affluent black people in the world. However, there is another black billionaire who isn’t a household name here in the United States but is making headlines throughout the world with his business organizing a $5 billion London share sale.

His name is Alhaji Aliko Dangote, owner of a multi-billion dollar conglomerate known as the Dangote Group based in Nigeria and with operations throughout Africa. He is ranked in Forbes as one of the richest black African descendants behind Mohammed Al Amoudi and Oprah Winfrey with his net worth of $2.5 billion dollars.

Alhaji started the Dangote group as a small trading firm in 1977. The Dangote group slowly emerged as a successful African conglomerate with businesses in industries such as food processing, cement manufacturing, real estate. They are also continuing to expand with new projects in oil development, natural gas, telecommunications, fertilizer production, and steel. The Dangote Group continues to see its dominance in the sugar market in Nigeria where it is the major sugar supplier to the country’s soft drink, deserts, and brewery plants.

Dangote Cement, the largest cement production company in Africa and subsidiary of the Dangote Group, is currently in the news with its plan to sell up to 5 billion in shares as reported in Business Week.

With the help of investment banks Goldman Sachs Inc., J.P. Morgan Chase & Co., and Morgan Stanley, the company aims to sell three to five billion’s worth of global depositary receipts in London. A global depositary receipt is a bank certificate issued in more than one country for shares in a foreign company. The advantage here is that the shares trade as domestic shares but are offered for sales around the world through bank branches of an international bank. This is what allows Dangote Cement, a Nigerian Stock Exchanged-based company, to sell its shares in London to gain international investors.

The reasons why the company has decided to open itself up to foreign investors is due to the need for increased capacity to meet the demand for cement in Nigeria. The company plans to increase capacity five times by 2015. Demand for cement in Nigeria, sub-Saharan Africa’s second largest economy is expecting a 45 percent increase in 2010 alone and the trend is expected to continue for years to come. With the Nigerian stock market already tapped out from Dangote Cement’s $13.5 billion naira-Nigerian dollar ($90million) IPO, Dangote Cement wants to attract foreign investors to support the company’s growth.

The Dangote Group stands as a modern day success story for emerging markets. Beginning in only 1977, this company has grown from a small trading firm to a multi-billion dollar conglomerate. Increased demand in cement and increased consumer spending in these emerging markets only offer more growth for this company in the future.

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