Throwback/Historical
Dangote Vs. Otedola: Revisiting The Famous “Beef”
In June 2013, Nigerian oil marketing company, African Petroleum (AP), ran ads in several mainstream newspapers in Nigeria. In the publications, they accused companies owned by billionaire Aliko Dangote and his stock broker, Nova Finance and Securities, of share manipulation.
AP claimed that Dangote had engaged in “certain unwholesome and unethical activities.” The company revealed how Dangote allegedly helped push African Petroleum’s stock down by 80% through the practice of “crossing”. Femi Otedola was the owner and Chairman of African Petroleum at the time.
This became the peak of the famous squabble between two “best friends” who happened to be Nigeria’s wealthiest and most influential business tycoons.
Friendship
Dangote and Otedola hit national limelight as good jolly friends. This was during the civilian government of Obasanjo. The two had grown their business empires by enjoying the wave of excessive patronage by the former president.
All through the era of Obasanjo in government, Dangote and Otedola clung to one another like Siamese twins. The two at a point became recurring decimals in big time social events organized either by the government or private individuals. They were also both noted as biggest donors during fund-raising programmes at such events. They also had both funded the campaigns of former President Obasanjo for re-election in 2003.
How the Disagreement Started
The rift between Femi Otedola, the chairman of Forte Oil and founder of Zenon Petroleum, and Aliko Dangote, the chairman and CEO of the Dangote Group, began in 2008. Before then, it was said that these two friends had made a gentleman’s agreement not to step on each other’s business turf.
Otedola’s Zenon Petroleum was a major supplier of diesel in Nigeria and Dangote had made his fortune in sugar production, cement manufacturing, and more.
The trouble, however, started when Dangote decided to diversify and step into Otedola’s downstream oil and gas sector, a market Otedola had dominated.
A consortium that included Dangote’s family investment firm, MRS. Holdings, outbidded Otedola’s company in a scramble to acquire Chevron. It paid $1 billion for Chevron’s West Africa division. The amount was $800 million higher than Otedola’s bid for just the Nigerian operations.
After Dangote stepped on Otedola’s turf in the Chevron deal, Otedola retaliated by trying to block the sale in court. Otedola also stepped up by acquiring significant shares in Dangote’s publicly traded companies. He didn’t stop there. He announced plans to invest $2 billion in sugar and cement production.
These actions heralded the well-publicized feud between two of Nigeria’s wealthiest and once friends. The dispute soon captured the attention of both the public and business world.
Reason for the Dispute
At the heart of the feud was competition over market share and dominance in the oil sector. Otedola’s company, Zenon Petroleum, had a stronghold in the importation and distribution of diesel. The investment was a major player in powering Nigeria’s industrial sector.
Meanwhile, Dangote’s diversification into the oil sector and subsequently his refinery project seemed to threaten Otedola’s interests.
Though there were no publicized personal attacks, their rivalry became the talk of the business community, fueled by rumours of corporate maneuvers aimed at undercutting each another’s business investments.
Their rivalry between the two billionaires spanned a few years before a reconciliation brought the two back to friendly terms.
Reconciliation: Obasanjo’s Intervention
The famous feud between Femi Otedola and Aliko Dangote finally came to an end around 2014. Key figures in Nigeria’s elite circle, recognizing the damaging effects of the rivalry on the country’s economy and the personal relations between two of its most powerful figures, intervened.
One of the most notable mediators in their reconciliation was Olusegun Obasanjo. The former president played a significant role in bringing the two business magnates together. Obasanjo is known for his influence in Nigerian politics and his ability to settle disputes among top figures in the country.
According to reports, Obasanjo organized a meeting where both Otedola and Dangote could discuss their differences and seek ways to collaborate rather than compete. The conversation was reportedly productive, as both businessmen agreed to bury the hatchet.
By 2015, the two men were seen together in public on several occasions, signaling their renewed friendship. Both Otedola and Dangote have since been quoted praising each other’s business acumen and leadership, with the feud now long behind them.
The Aftermath: Cooperation and Friendship
Since their reconciliation, Otedola and Dangote have demonstrated their friendship, mutual respect and collaboration on several fronts. They have been seen together at various high-profile events, further indicating that their relationship has grown stronger.
Dangote’s massive oil refinery project, which is one of the largest in the world, is no longer viewed as a threat by Otedola. This is so because Otedola has evolved as he has sold his stake at Forte Oil ( formerly African Petroleum) and Zenon Oil. He is now heavily invested in the electricity generation sector.
Both men have also been more vocal about their shared vision for Nigeria’s future. They both have huge investments in sectors vital to the country’s development.
Their cooperation post-reconciliation has been an example of how even the fiercest of business rivals can come together for a greater purpose.
Dangote Vs. Otedola