Dangote Cement becomes Nigeria’s largest listed firm

Dangote Cement becomes Nigeria’s largest listed firm
Published: 27 October 2010

Dangote Cement listed 15.5 billion shares at NGN135 yesterday, after a merger this month with local rival Benue Cement, making it the country’s leading cement maker and the biggest company ever to list on the Nigerian stock exchange.

The billionaire held majority stakes in Benue Cement and Dangote Cement through his holding company Dangote Industries, meaning the free float of the listed entity was initially just 4.1 per cent, below the regulator’s 25 per cent minimum.

He sold US$154m worth of shares to bring the free float to 5.2 per cent.

Dangote Cement executives have said the firm plans to sell a further 20 per cent – worth US$2.8bn based on the listing price – in a global offer over the next 18 months, probably in London. Listing broker Afrinvest said 25 per cent of the shares were theoretically on offer in Nigeria, but the local market, whose capitalisation was just over NGN6trn before the listing, was unlikely to have the capacity to buy that amount.

"Because the market is not likely to absorb all of that quantity, the (stock exchange) council has given a special dispensation to sell the remainder over the next two years," Afrinvest Chief Executive Godwin Obaseki said.

The shares were Nigeria’s most heavily traded on Tuesday, despite listing less than half an hour before the market closed. They ended flat at NGN135 naira and accounted for some 40 per cent of total volume, with more than 196m traded.