- BUA’s new sugar refinery unnecessary, Dangote Tells FG
- BUA Fires Back: Your claims ludicrous… Alleges Dangote of Price-fixing
The acrimonious relationship between Dangote Sugar Refinery (DSR) and the BUA group has hit the rooftop, following the establishment of a new sugar refinery plant by the latter.
DSR is part of the conglomerate owned by Africa’s richest man, Alhaji Aliko Dangote, while Alhaji Abdul Samad Rabiu chairs the BUA Group, also a multinational conglomerate. The two Billionaires who hail from Kano have rabid business interests that are well-entrenched in Nigeria and West Africa, making them to often compete in the same markets and for same consumers especially on cement and sugar products among other staple commodities.
The New Diplomat recalls their feud had hit newspaper headlines recently when Dangote Group, a member of the the Coalition Against COVID-19 (CACOVID) and BUA group of companies engaged in a war of wits over claims by the latter that it had singlehandedly purchased one million doses of AstraZeneca Covid-19 vaccines for Nigeria.
Following the announcement, CACOVID would later hit back at BUA, also a member of the coalition, stating that no individual or company can purchase vaccines directly from any legitimate manufacturer. But BUA was quick to finger Dangote for CACOVID’s objection to its goodwill which later turned to Billionaires’ war-of-words.
The latest musing between BUA and Dangote Group was as a result of a new sugar refinery plant in Port Harcourt, Rivers State built and commissioned by BUA.
The Chairman of Dangote Group, Aliko Dangote, had argued that the establishment of the new Sugar Refinery plant would pose a threat to the execution of the National Sugar Master Plan (NSMP), adding that it would also affect the sustainability of the local production of Sugar.
Dangote, alongside the chairman of the Flour Mills Of Nigeria PLC, Mr. John Coumantaros, had written a petition to the Minister of Industry Trade and Investment, Niyi Adebayo, warning about the risk of the establishing another sugar refinery plant in the country.
According to the duo, the intention of BUA group is solely to import and refine sugar without investing in the development of sugar plantations in the country.
The duo had also alleged that the Port Horcourt sugar refinery was established to undermine the Federal government’s sugar policy as stated in the NSMP.
Reacting, the Chairman of the BUA Group, Alhaji Abdulsamad Rabiu dismissed the claims made by Dangote, stating that the refinery in Port Harcourt would not in any way affect Nigerians or the policies of the Federal Government.
According to him, “the only way it (Port Harcourt Sugar Refinery) will affect Nigerians is that Nigerians will pay lower prices for sugar.”
Rabiu stated that its Port Harcourt refinery would not pose any threat to the established sugar’s policy, adding that it would only checkmate the increase in sugar price by the major players in the Sugar business.
He alleged that the only reason Dangote and Flour Mills companies are concerned about the new refinery is because of the imminent reduction in the cost of sugar in the country.
The Chairman of BUA Group also stated that the refinery has employed over 1000 Nigerians, stating that the refinery will help to reduce unemployment in the country as well as boost human development.
The response by the BUA Group was contained in a five-page statement.
The statement partly reads, “The BUA Group take serious exception to the ludicrous claims by its two major competitors that it aims to circumvent the BIP of the sugar industry.
“The establishment of the BUA’s Port Harcourt Sugar Refinery is allowed under the Nigeria Export Processing Zones Authority Act( NEPZA). The same NEPZA Act upon, which the project is based, gives the permission to process, add value and export at the same time. Companies under this act are allowed to process and if they so wish, sell 100 per cent of their production in Nigeria with payment of duties based on the current raw materials tariff.
“As a matter of fact, Aliko Dangote of Dangote Industries, who is one of the complainants alleging and attacking this approval has also applied and obtained the same approval for his refinery project in Lekki, Lagos State where he is currently enjoying the same benefits of being in an Export Processing Zone(EPZ).
“What BUA sugar is doing is legal and within the confines of the law. We have not done not are we doing anything wrong. The establishment of the new Refinery is absolutely necessary, in the face of arbitrary price increases and collusion to force scarcity of the product locally.”
Meanwhile, DSR, in a counter-response, has denied engaging in price-fixing, alleging that the BUA group are bent on “tarnishing the good name and brand” of Dangote industries.
The Dangote Group Managing Director, Ravindra Singhvi, in a statement, described the allegations as mischievous and a calculated attempted to create confusion in the public.
He stated that the DSR has a responsibility to the government and the people of Nigeria, adding that the company will “do all that is necessary to vehemently protect the integrity of the sugar industry”, and will “not engage in price-fixing and will encourage healthy competition amongst the key players of the industry.”
The statement reads, “Dangote Sugar Refinery PLC (DSR) is aware of an online publication claiming that Dangote Sugar Refinery PLC is engaging in price-fixing and is not honestly engaged in any Backward Integration Programme as claimed.
“DSR wishes to vehemently refute the allegations and assertions in their entirety as the false allegations are geared at tarnishing the good name and brand of Dangote Sugar Refinery Plc and Dangote Industries Limited.
“DSR does not engage in artificial price manipulation of its products, either during the Holy month of Ramadan or at any other time. We have never ever increased price of our food items or commodities during the Holy month of Ramadan in the history of our operations.”
“DSR has a responsibility to the government, the good people of Nigeria and the Sugar Industry and all other stakeholders to protect the integrity of the Sugar industry and wishes to assure its stakeholders as follows: It will do all that is necessary to vehemently protect the integrity of the Sugar Industry, it is not engaged in price fixing and it encourages healthy competition amongst the players.
“We believe our action is in line with our responsibility as a major stakeholder to alert the supervising ministry on activities that would derail the plan of the Federal Government in its drive to self-sufficiency in Sugar under the NSMP”, the statement added.