By investadvocate

Nov 23 2010 16.12 GMT

Lagos (INVESTADVOCATE)-Newly listed Dangote Cement Plc (DANGCEM) is planning to list a Global Depository Receipts (GDR) on the London Stock exchange (LSE).

 

Alhaji Aliko Dangote, President/Chief Executive of the Dangote Group confirmed this to Reuters in an interview Monday 22 November 2010 in London.

 

Dangote had affirmed that the Federal Government’s (FG’s) current incentives to Nigerian exporters and the friendly import policies of Economic Community of West African States (ECOWAS) countries make export of cement to neighbouring West African countries a viable proposition.

 

“If we export from Nigeria to any of these countries, first of all we collect 30 percent (30%) export incentives.  Secondly, when we get into those countries, we are not to pay local duties. So it will benefit us quite a lot” Dangote said.

 

He further affirmed that DANGCEM would as from 2012 begin the exportation of cement to some ECOWAS countries in view of its envisaged excess local capacity of more than 20 million metric tonnes and the huge demand for the product in the sub-region.

 

According to him, as part of its strategy of capturing the ECOWAS market, DANGCEM already has a cement plant in Ghana, “there are good market opportunities in other neighbouring countries such as Liberia, Sierra Leone and Cote D Ívoire, which lack limestone, one of the basic raw materials used in the production of cement” the President of the Dangote Group said.

 

“The only thing that we need to do is to quickly create that avenue of exporting cement rather than importing cement,” he affirmed.

 

Dangote also confirmed that DANGCEM is currently consolidating its cement businesses across Africa to reap the benefits of scale.

 

“The listing of DANGCEM on the Nigerian Stock Exchange (NSE) last month was part of this strategy. The Cement firm listed at N2.13 trillion ($14 billion), which is currently the biggest quoted company in Nigeria accounting for about 30 percent of the entire Capital Market capitalisation.

 

“And the third phase now, which we will do within the first quarter (Q1) of next year, will be the other African assets which are owned by Dangote Industries that will be taken over by Dangote Cement, this will take us to about 46 million tonnes by 2015” he said.

 

On the planned GDR, he affirmed that DANGCEM has made up its mind to do a GDR at the London Exchange. “The structure is much better for us, it is a Market we understand very well” Dangote affirmed.

 

“We have to do it in stages, where we do a GDR first, then we will list going forward on the Main Market. We have an internal target to list in the next year. I think we will achieve it” he said.

 

The President of the Dangote Group also confirmed to Reuters that Morgan Stanley is one of three international Investment Banks that would advise on the issue.