Nigerian billionaire Aliko Dangote commits $800 million to double his Itori cement plant

Aliko Dangote has signed an agreement worth more than $800 million with the Chinese engineering group Sinoma International to double the capacity of his cement plant at Itori, in Nigeria's southwestern Ogun State, from six million to 12 million metric tonnes a year.

The memorandum of understanding was signed by Dangote, president of Dangote Group, and Sinoma chairman Lin Zhong. Dangote Industries announced it in a statement on Sunday.

At current exchange rates the commitment is worth roughly ₦1.11 trillion, and it is a memorandum rather than a construction contract, meaning the terms still have to be converted into binding agreements.

Two things are driving the decision, and Dangote named both.

The first is a change in how Nigeria builds roads. The federal government has been pushing contractors toward concrete rather than asphalt, arguing that concrete surfaces last longer in the country's climate and reduce dependence on imported bitumen. That policy shift creates domestic demand for cement that did not exist at the same scale five years ago.

The second is export. Dangote said the expanded plant would increase the company's ability to serve markets outside Nigeria and generate foreign exchange, framing it within a target of producing between 90 million and 100 million metric tonnes a year by 2030.

"This $800m investment represents another bold step in our commitment to strengthening Nigeria's industrial base and reinforcing our leadership in Africa's cement industry," he said. He added that the expansion reflected confidence in the Nigerian economy and would contribute to job creation and regional trade.

He thanked President Bola Tinubu for what he described as an enabling environment for business.

Sinoma is among the world's largest cement engineering contractors and has built several of Dangote's existing plants. Lin said the partnership had produced some of the most modern and efficient cement manufacturing facilities in Africa, and that his company would deploy its engineering expertise and technology to deliver the expansion.

The commitment lands at an unusual moment for the group.

Dangote Cement reported half-year results last week showing revenue of ₦2.51 trillion, about $1.81 billion, up 21.4%, and net income of ₦640.22 billion, roughly $460.6 million, up 24.3%. But the second quarter was weaker beneath the headline. Sales rose 22.2% while net income grew only 4.4%, as margins narrowed against an unusually strong comparative period.

The company is also carrying two other capital projects at once. Dangote Petroleum Refinery has applied to Nigeria's Securities and Exchange Commission for an initial public offering targeting September, seeking to raise as much as $5 billion at a valuation of about $50 billion. And Dangote has said he is considering a London listing for Dangote Cement by the end of the year.

Committing $800 million to a single plant while pursuing the largest share sale in African market history is a substantial demand on the group's balance sheet, though the cement expansion is a multi-year build rather than an immediate cash outlay.

Dangote Cement is the largest cement producer on the continent, operating across ten African countries and employing 21,418 people. Nigeria accounts for 74.4% of group sales. The company carries a market value of roughly ₦17.32 trillion, about $12.46 billion, and its shares have gained close to 70% since the start of the year.

Dangote holds close to 86% of it through Dangote Industries, making it his largest listed asset and, until the refinery lists, the only one carrying a public market price.

Neither company gave a construction timetable for the Itori expansion, or said when the additional six million tonnes of capacity is expected to come on line.