Dangote $700 Million Deal to Meet Third of Nigeria’s Sugar Needs

LAGOS (Capital Markets in Africa) – A Dangote Industries Ltd. subsidiary will invest $700 million in a central Nigerian project that seeks to produce almost a third of the sugar consumed in Africa’s most populous nation.

Tunga Sugar project, in the central state of Nasarawa, will be made up of a 60,000-hectare (148,260-acre) plantation and two factories with combined capacity of 430,000 metric tons of refined white sugar, Dangote Group’s president, Aliko Dangote, said in a speech delivered Thursday at the signing, a copy of which was obtained by Bloomberg.

The company targets producing about 1.08 million tons of white sugar annually in the next five years and 1.5 million tons per annum in the next decade, said Dangote, Africa’s richest man.

The Dangote Group, best known for its cement business, has been investing in agriculture as Nigeria’s government seeks to make the country of 180 million people self-sufficient in food. The Central Bank of Nigeria has been offering companies incentives to produce locally amid foreign-exchange shortages brought on by lower oil production and prices.

The Dangote Group last month announced it will probably invest more than $1 billion over five years to increase its rice production to 1.7 million tons per year by 2019.

Dangote Sugar Refinery Plc shares were down 2.5 percent at 9.07 naira on the Nigerian Stock Exchange in Lagos by 10:53 a.m. They’ve climbed 43 percent this year, while the All Share Index has gained 23 percent.