Aliko Dangote, Africa's richest man with an estimated fortune of $51.3 billion, closed or sold six major businesses before achieving success with his $20 billion Dangote Refinery, which is now valued at approximately $47.6 billion. The refinery, with a capacity of 700,000 barrels per day, has attracted significant interest from Nigerian retail investors and international institutions through its $1.6 billion initial public offering.
Textile Closures: The Biggest Business Mistake
Dangote's textile venture proved to be his most painful setback. The group invested in Dangote General Textile Mills and acquired the foreign shareholder in Nigerian Textile Mills, which was established in 1960 for the Western Region under Chief Obafemi Awolowo. However, cheap imports, unreliable electricity, high operating costs, and competition from Chinese and Indian products made the factories difficult to sustain.
"My biggest business mistake was textiles," Dangote said. The closures affected nearly 8,000 workers, including 6,920 employees at Nigerian Textile Mills in Ikeja. Many had worked there for between 25 and 30 years, leaving the company with substantial pension and gratuity obligations.
Flour Business Exits Twice
Dangote Flour Mills, established in 1999 and listed in 2008, was another complicated venture. In 2012, Dangote sold a 65% stake to Tiger Brands for about $200 million. After the South African company struggled and exited, Dangote bought the business back at a lower price. He later withdrew from the flour industry again, citing foreign-exchange challenges. In 2019, Olam acquired Dangote Flour Mills for ₦120 billion and integrated it into Crown Flour Mills.
Telecom Licence Failed to Produce an Operator
Dangote also attempted to enter Nigeria's rapidly expanding telecommunications industry. The group reportedly paid about $20 million for a licence and planned to challenge MTN, Glo, and Airtel. However, internal disagreements, regulatory delays, and the enormous cost of building a nationwide network prevented the project from becoming operational. Dangote eventually abandoned the venture, missing out on an industry that would become one of Nigeria's largest.
Tomato Factory Battled Supply Shortages
Dangote's tomato-processing factory opened in Kano in 2016 with the capacity to process 1,200 tonnes of fresh tomatoes daily. The plant was expected to reduce Nigeria's dependence on imported tomato paste and provide a reliable market for farmers. Instead, it repeatedly closed because of inadequate supplies and high operating costs. By 2021, Dangote said farmers were supplying only about 20% of the plant's capacity and that the investment had barely generated a profit.
Aviation Venture Proved Short-Lived
In 2002, Dangote partnered with Sam Iwuajoku and Seaside View Management to establish Executive Jets Services. The company started VIP charter operations with a nine-seat Hawker Siddeley aircraft and planned to expand into passenger services. Operational difficulties, however, made the aviation venture short-lived.
Liberty Bank Sold to Settle Workers
Dangote ultimately sold Liberty Merchant Bank for ₦1.2 billion to meet obligations arising from the textile closures. "By the time we sold Liberty, I cashed out N1.2 billion," he said. "The industry consumed N985 million to pay pensions and gratuities just to get out of the business." Dangote said the experience showed that the group had "burnt our fingers", offering a striking contrast to the refinery success that now defines his industrial empire.
