Africa’s biggest cement producer, Dangote Cement Plc, secured a $2 billion loan from International Commercial Bank of China. “It’s for my two cement companies that we are establishing in Nigeria,” said billionaire and CEO of the firm, Aliko Dangote. Few weeks ago, Africa’s richest presided the foundation stone-laying ceremony of the Okpella cement plant, in Edo state.

The cement group thus adapts to the market which currently records a growing demand for cement, spurred by investment in infrastructures. In these conditions, all major cement dealers operating in the region (Lafarge-Holcim Africa, Heidelberg) are competing. Dangote plans to, beyond Nigeria, boost its production capacity across the 12 countries where it is present, to 81 million tons per year.

For the Chinese bank, the loan presents a limited risk since it insured that the lender will have enough to generate significant revenues. Even outside the African market, Dangote Cement shows a quite interesting credit profile. At the end of the year 2015, the firm’s cash flow was N318.3 billion for a total short and mid term debt of N263 billion. Moreover, its pre-tax profit to amortization over interest ratio was 397.3%.

Idriss Linge