Aliko Dangote’s business empire today is difficult to miss. His $1.6 billion Dangote Refinery IPO has attracted huge interest from Nigerian retail investors and international institutions, valuing the 700,000-barrel-per-day refinery at about $47.6 billion.
- Aliko Dangote’s business empire, now valued at over $51.3 billion, was shaped not only by success but also by high-profile failures across multiple industries.
- Dangote’s significant setbacks included the textile industry, where thousands of workers lost jobs.
- Dangote’s ambitious forays into telecom, tomato processing, aviation, and banking all ended with withdrawals or closures following internal disputes, operational hurdles, or insurmountable market challenges.
Dangote himself is now worth an estimated $51.3 billion. But the scale of his empire was not built through successful bets alone.
Over the decades, Dangote has ventured into industries ranging from cement and sugar to textiles, banking, telecommunications and food processing. Some became major businesses. Others did not survive.
Textiles, for example, became a costly setback, with factories eventually shut and thousands of workers affected. His Liberty Merchant Bank was later sold, with much of the proceeds used to settle pension and gratuity obligations linked to the textile business.
Behind the billionaire fortune and sprawling conglomerate is therefore another part of the Dangote story — businesses that failed, investments that had to be abandoned and expensive lessons that shaped the empire he runs today.
Here are the businesses Dangote had to shut down before his $20 billion refinery:
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1) Dangote Textiles
Dangote’s textile business became one of his biggest setbacks. The group invested in Dangote General Textile Mills and acquired the foreign shareholder of Nigerian Textile Mills, a factory established in 1960 for the Western Region by Chief Obafemi Awolowo. But cheap imports, Chinese and Indian dumping, weak government protection, unreliable power and high operating costs made the businesses difficult to sustain.
Dangote eventually shut both factories. Nigerian Textile Mills was particularly difficult to close because many employees had worked there for 25 to 30 years, leaving the company with significant pension and gratuity obligations.
“My biggest business mistake was textiles,” Dangote said. The closures affected nearly 8,000 workers, including 6,920 at Nigerian Textile Mills in Ikeja.
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2) Dangote Flour Mills
Dangote Flour Mills was not a straightforward failure, but became one of Dangote’s most complicated ventures. Founded in 1999, the company grew rapidly and was listed in 2008. In 2012, Dangote sold a 65% stake to Tiger Brands for about $200 million.
Tiger later struggled and exited, allowing Dangote to buy it back at a lower price. Dangote eventually exited the flour business again, citing foreign-exchange challenges.
In 2019, Singapore-based agribusiness giant Olam acquired Dangote Flour Mills for ₦120 billion. The business was later integrated into Crown Flour Mills, strengthening Olam’s position in Nigeria’s flour market.
3) Dangote telecoms
Dangote also tried to enter Nigeria’s telecommunications industry during its rapid expansion. The group reportedly paid about $20 million for a telecom licence and planned to compete with operators such as MTN, Glo and Airtel. But the project never became a functioning telecom operator.
Internal disputes, delays in securing approvals and the enormous cost of building a nationwide network made the venture difficult to pursue. Dangote eventually withdrew from the sector. It became one of the group’s notable missed opportunities, particularly as Nigeria’s telecoms market later became one of the country’s biggest industries.
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4) Dangote Tomato Processing
Dangote entered tomato processing in 2016 with a Kano factory designed to process 1,200 tonnes of fresh tomatoes daily. The project aimed to reduce Nigeria’s reliance on imported tomato paste and create a market for local farmers. But the factory struggled to secure enough tomatoes.
By 2021, Dangote revealed it had barely turned a profit, with farmers supplying only about 20% of its capacity.
The plant was intended to capture some of the 900,000 tonnes of tomatoes reportedly wasted after harvest each year and reduce imports from China. Instead, supply shortages, high energy costs and other challenges led to repeated shutdowns and reopenings.
5) Dangote Airlines
Dangote also ventured into aviation in 2002, partnering with Sam Iwuajoku and Seaside View Management to launch Executive Jets Services. The company began VIP charter operations with a nine-seat Hawker Siddeley HS125-700A aircraft and planned to expand into passenger services with two Embraer 120 aircraft.
However, the venture struggled with operational challenges and was short-lived. Dangote eventually abandoned the airline business, adding aviation to the list of sectors where he explored an opportunity but failed to establish a lasting commercial operation.
6) Liberty Merchant Bank
Dangote was forced to sell Liberty Merchant Bank to help settle the pension and gratuity obligations from his textile businesses. The bank sold for N1.2 billion, but nearly all the proceeds went to closing the textile businesses and paying former workers.
“Luckily for us, somebody now came and said he wanted to buy our bank, Liberty Merchant Bank,” Dangote said. “By the time we sold Liberty, I cashed out N1.2 billion.
The industry consumed N985 million to pay pensions and gratuities just to get out of the business.” He described the experience as one in which “we burnt our fingers.”
