Business News
How we Acquired Obajana Cement, Built Factory-Dangote
The management of Dangote Industries Limited has insisted that its acquisition of the Obajana Cement Plc in 2002 followed due process, contrary to claims by the Kogi State Government.
Dangote stated that the Kogi State Government has no equity interest in Obajana Cement Plc, adding that the company as a responsible corporate organisation has been paying relevant state taxes, levies, and charges to the state government since 2007 when production commenced in the acquired cement plant.
Dangote Industries Limited made this known via a statement issued on Tuesday.
The company noted that the land on which Obajana Cement Plant was built was acquired by Dangote Industries Limited in 2003, adding: “After it had acquired the shares in Obajana Cement Company in 2002, following the legally binding agreement it entered into with KSG to invest in Kogi State.
Dangote Industries Limited was issued three Certificates of Occupancy in its name after payment of necessary fees and compensation to landowners.“The plant and machinery were conceived, designed, procured, built, and paid for solely by DIL, again, well after it acquired the shares in Obajana Cement Company. The limestone and other minerals used by the Obajana Cement Plant, by the provisions of the Nigerian Constitution belonged to the Federation, with authority only in the FGN and not the state in which the minerals are situated, to grant licences to extract and mine the resources.
“After the agreement with the KSG, DIL applied for and obtained mining leases over the said limestone from FGN, at its cost and has complied with the terms of the leases since inception. The government of Kogi State had no minerals to give, had no assets to give, and only invited DIL as most responsible governments do to come into the State and invest in a manner that will create employment, develop the State, and earn it taxes,” it said.
Dangote further noted: “In 1992, the Kogi State Government incorporated Obajana Cement PLC as a public limited liability company. Sometime in early 2002, about 10 years after the incorporation of the OCP (which still had no assets or operations as of that time), KSG invited Dangote Industries Limited to take the opportunity of the significant limestone deposit in the State by establishing a cement plant in the state.
“Following several engagements and assessment of the viability of the proposed opportunity, DIL agreed that it would establish a cement plant in Kogi State and provide the entirety of the substantial capital required for the investment.
“DIL also agreed, following a specific request by KSG, to use the OCP name (albeit only existing on paper as of that time, and without any assets or operations) for the time being, as the vehicle for this investment. On 30 July 2002, KSG and DIL entered into a binding agreement to document their understanding. The agreement was amended in 2003 and remains binding on, and legally enforceable by, the parties to same.”
On the issue of an agreement between Dangote and Kogi State Government, the company stated that “it was agreed, inter alia, that: DIL would establish a cement plant with a capacity of 3,500,000 metric tonnes per annum; DIL shall hold 100% of the shareholding in OCP, and source for all the funds required to develop the cement plant; KSG shall have the option to acquire 5% equity shareholding in OCP within 5 years; and KSG shall grant tax relief and exemption from levies and other charges by KSG for a period of seven (7) years from the date of commencement of production.
“Consistent with the terms of agreement, DIL sourced for 100% of the funds that was used to develop the plant without any contribution from KSG. In line with its rights, ensuring alignment with the Dangote Brand, as part of internal restructuring and for better market recognition the name of OCP was changed to Dangote Cement Plc in 2010, and a number of other significant cement companies (such as the Benue Cement Company) owned by DIL were merged with OCP to become the enlarged Dangote Cement Plc,” the company added.
On the issues of ‘Execution of the Agreement: The Plant, Taxes, Shares and Dividends’, Dangote noted that “DIL assiduously and at significant cost met all the terms of the agreement between it and KSG in relation to OCP. It built the cement factory, much bigger and better than envisaged.
“KSG could not meet its financial obligations of contributing to the funding the plant in any form; neither could KSG fund acquisition of 5% equity shares in OCP when it was asked on a number of occasions to exercise the purchase option.
“KSG also did not meet its obligations to grant waiver of taxes, charges and levies that it could charge the operations, affairs and activities of OCP. Rather despite being entitled (under the terms of the agreement with KSG) to tax relief and exemption from charges and levies by KSG for a period of seven (7) years from the date of commencement of production, OCP (and now DCP) has paid all due sub-sovereign taxes, levies and charges to KSG since it commenced production in 2007.
“KSG does not have any form of investment or equity stake in OCP, so no dividend or other economic and/or shareholding rights whatsoever could have accrued to it from the operations of the company,” the company said.
The Greater Port Harcourt City 2024 Management Retreat, with the theme, “Transiting to New Smart Cities; The Beginning” which held from April 26 – 27, 2024 at the Swiss International Hotel, Mabisel, Port Harcourt brought together a diverse group of government officials, stakeholders, industry experts, and leaders of thought to deliberate on key issues related to the sustainable development and growth of Greater Port Harcourt City.
The retreat was flagged-off by the Governor of Rivers State, Sir Siminilayi Fubara, ably represented by the Deputy Governor, Prof (Mrs) Ngozi Nma Odu who assured the Greater Port Harcourt City Development Authority (GPHCDA) management that the Governor has a keen interest in seeing that the vision of creating the Greater Port Harcourt City is fully realized during his tenure.
He emphasized his commitment to support the authority towards the achievement of the vision for the good of the people of Rivers State and truly make Greater Port Harcourt City a model for other states to emulate, calling on the management to seize the moment and lay the ground work for a city that is prosperous, liveable and futuristic.
In his address, the acting Sole Administrator TPL (Dr) Tonte Davies highlighted the road map and action plan, which the GPHCDA is undertaking towards achieving the vision of creating new smart cities and in the context of the outlined drive, the recent ground-breaking for the ongoing 20,000 low income housing units is a recognised cardinal move that points to the start of a major implementation activity which will enhance this focus.
He also listed achievements like the completed phase 1 storm water canal retention, the 500,000liters capacity water project, the installed 11kva switch-gear panel, and 3kva electricity power substation amongst other ongoing infrastructural projects. Dr Davies happily informed the meeting of the introduction of a digital solution to streamline physical planning regulations and documentation to facilitate business transactions and enhance express approvals, which promotes the ease of doing business in that regard.
The Executive Secretary, Nigerian Content Development Management Board, Engr. Omatsola Felix Ogbe, represented by Mr Olubisi Okunola, Manager Strategy, presented a paper on “Transformation and Reorganisation of a 21st Century Organisation; The NCDMB Experience.” He took the participants through the transformative journey of the board, which placed them as one of the most productive public sector organisations in the country. He stated that the board has transformed the oil and gas sector with strategic partnerships, which has enhanced local participation in the industry to about 70% in the past few years.
Also an international investor from Gambia and CEO of RIV/TAF, Mustapha Njie, presented a paper on affordable housing Initiative and promised the timely completion of the ongoing TAF City 20,000 housing units project, a pet project of Gov Sim Fubara. He gave participants strategic insight on the keys to successful project implementation and project delivery and stated that the RIV-TAF project has recorded remarkable progress with *about* 400 housing units *at various stages of completion within three months of its flagoff.*
The lead paper presenter, renowned Town Planner Kazeem Sanusi tasked the management of the Greater Port Harcourt City Development Authority to stand out in their responsibilities emphasizing that the most beautiful aspect of planning is inclusiveness, utilizing the power of crucial discussions and team work. He stated that the GPHCDA stands on the threshold of history to transform the new city into a model smart city just like Dubai was transformed in the past few decades.
He urged the participants to be committed to fostering partnerships and *collaborations* to drive sustainable development in Greater Port Harcourt City, including engaging with private sector stakeholders, civil society organizations, and international partners to implement the sustainable development practices and initiatives in the new city.
In his closing remarks the Administrator, Greater Port Harcourt City, TPL (Dr) Tonte Davies promised a commitment to the comprehensive action plan outlining key priorities, initiatives and timelines for implementing the ideas and recommendations generated during the retreat. He further declared that the just concluded Greater Port Harcourt City Management retreat has set the stage for a new chapter in the city’s development journey, noting that the vision, passion and commitment of Governor Sim Fubara and the enthusiasm and shared vision of all participants has laid a strong foundation for the sustainable growth and prosperity of Greater Port Harcourt City and the state at large.
The Lead Consultant Mr Ono K. Akpe of Red Sapphire Ltd , Abuja, who led a team of seasoned facilitators engaged the participants for the two days at the retreat with cutting edge intellectual discourse to broaden knowledge in various aspects of management covering work ethics, organizational culture, entrepreneurship, team building, infrastructural development, innovation and mind-set change, re-branding and marketing smart cities.
By Tony Obiechina, Abuja
The African Export-Import Bank (Afreximbank) has announced the successful completion of a first-of-its-kind India-focussed club deal for US$282.00 million.
Initiated for the exclusive participation of Indian lenders, and arranged by Bank of Africa UK PLC, the primary syndicated club deal saw participation from Indian lenders through their overseas branches and subsidiaries in the Dubai International Financial Centre in the United Arab Emirates, Singapore and Mauritius.
The facility, which was backed by six participating banks and financial institutions, including five that joined as first-time lenders to Afreximbank, helping the Bank achieve its objective of diversifying its funding sources, carries a three-year tenor.
At a commemorative event held in Dubai, U.A.E., to mark the conclusion of the deal, Haytham ElMaayergi, Executive Vice President at Afreximbank, said that the conclusion of the initiative represented a major milestone for the Bank as it sought to fulfil the key objectives of its funding programme.
Highlighting the importance of investing in, and for, Africa, Mr. ElMaayergi said: “this facility will help Afreximbank to continue to play a major role in the development of intra-African trade and trade between Africa and the rest of the world, particularly with India.
It is a testament to the rapid growth in Africa’s economic relationship with India and is evidence of Afreximbank’s growing ability to harness resources into Africa and to fund trade finance related investments that would have a positive impact on trade between Africa and India.”
Chandi Mwenebungu, Director and Group Treasurer of Afreximbank, reviewing the Bank’s vision for Africa, said that its funding objectives included achieving the diversification of its liability book by geography, investor type and tenor.
Also addressing guests at the event were Said Adren, CEO of Bank of Africa UK PLC, who thanked the lenders for their participation, and Zineb Tamtaoui, General Manager of Bank of Africa, Dubai Branch, who expressed appreciation for the opportunity to put together “a landmark deal that would be a stepping stone to many India-focused club deals going forward.”
By Tony Obiechina, Abuja
Geregu Power Plc has generated N50.4bn on electricity sales and capacity charges to Nigerians in the first quarter of 2024.
The power company which is the first listed power company of the Nigerian Exchange Ltd disclosed the performance in its Q1, 2024 financial statement.
The company grew its Q1 revenue by 225 per cent from N14.
2bn in 2023 to N50. 4bn in 2023.A breakdown reveals that Geregu Power sold energy worth N31bn and received N19bn as revenue from capacity charge.
Recall that the power company posted an annual revenue of N82.9bn in the full year of 2023 but it has covered half of the amount in Q1.
The revenue was above the company’s forecast for Q1 2024 when it projected its revenue to rise to N31.24bn.
Geregu Power recorded a profit before tax of N21.9bn up from the N5.3bn recorded in Q1 of last year, reflecting 307.8 per cent growth.
During the period underreview, the company saw its profit after tax rose by 307.3 per cent to N14.46bn from N3.54bn recorded in Q1 of last year. In the full year 2023, the company made N16.1bn net profit.
The net profit was above the company projection of N5.5bn.
Geregu Power took an income tax charge of N7.43bn, up from the N1.8bn in Q1 2023. The tax charges were higher than the N2.7bn projected for Q1 2024.
The company also spent N21.5bn on the cost of sales involving gas supply and transportation, up from the N6.6bn spent on gas supply and transportation in Q1 2023.
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