Africa’s wealthiest individual and CEO of Dangote Group, Aliko Dangote, has revealed why the company decided to divest from Dangote Flour Mills in Nigeria in 2019.
Speaking to reporters in Lagos on Saturday, Dangote highlighted that the operation of the flour mill had inadvertently fostered heavy importation of wheat into Nigeria, a practice inconsistent with the core principles of the Dangote Group.
Dangote emphasized that the Dangote Group is committed to adding value across Nigeria’s economy, stating that importing wheat primarily creates employment opportunities in wheat-producing nations abroad rather than within Nigeria. Despite the significant market presence of Dangote Flour Mills as the second-largest miller in Nigeria, Dangote opted to sell off the business to curtail the extensive importation of wheat.
“At Dangote, everything we do is anchored in value creation. We are not just packaging plants. Across all our operations, we strive to enhance value by utilizing local raw materials, thereby contributing to a circular economy within Nigeria,” Dangote affirmed.
Regarding the decision to sell Dangote Flour Mills, Dangote explained, “We were number two in the flour milling sector, but we chose to divest because the heavy reliance on imported wheat was counterproductive to our mission of promoting local economic development.”
Currently, Dangote Group maintains its focus on sectors like sugar production, highlighting its commitment to sectors where it can leverage local resources effectively without significant import dependency.
Dangote underscored that this strategic approach aligns with the group’s goal of enhancing Nigeria’s industrial base and economic resilience.
The acquisition of Dangote Flour Mills by Crown Flour Mills Limited, a Nigerian subsidiary of Olam International Limited, was approved by shareholders in January 2019 following Olam’s payment of N120 billion. The transaction, executed through a Scheme of Arrangement, marked the conclusion of Dangote Flour Mills’ journey under the Dangote Industries Ltd umbrella since its establishment in 1999.
The flour milling division, which operated mills in key Nigerian cities such as Apapa, Ikorodu, Ilorin, Kano, and Calabar, was renowned for producing branded flour and offering value-added products through subsidiaries like Dangote Pasta Ltd.
In response to recent accusations from the Nigerian government regarding alleged attempts to monopolize the energy sector, Dangote reaffirmed that the group’s activities are aimed solely at enhancing Nigeria’s economic value chain.
He emphasized the importance of reducing import dependency and fostering industrialization to mitigate the current imbalance where Nigeria exports raw materials while importing finished goods.
Dangote summarized the situation as “importing prosperity while exporting poverty,” highlighting the imperative for Nigeria to prioritize industrialization and economic diversification to achieve sustainable growth and development.
