Peugeot, Dangote seal N3.5bn deal to produce cars in Kaduna
- The French car maker, PSA Peugeot Citroen, has signed a N3.5 billion deal with Aliko Dangote to set up an assembling plant in Kaduna
- The deal also includes five northern states, Kaduna, Jigawa, Kebbi, Katsina and Kano as partners
- According to the deal, the production of the automobile brand will begin in the state in 2019
Peugeot, in a joint venture with Aliko Dangote and five state governors governors in Nigeria will see the production and assembling of cars in the country by French carmaker, PSA Peugeot Citroen in 2019.
A partner with the firm, Peugeot Automobile Nigeria (PAN), has said that it will assemble 3,500 units in 2019 and increase the number to 10,000 units later on at a plant that will be built in Kaduna, Reuters reports.
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Jimi Lawal, the adviser to the governor of Kaduna said: “The first vehicle should come out by the first quarter of next year. We are hoping that the factory will be completed by December. The land has been identified … we have advertised for a contractor that will build the factory.”
Peugeot will begin with building its 301 sedans in minor volumes from semi-assembled kits of parts exported from Vigo, Spain. What will follow is the production of more models like the 308 compact then 508 model will be next.
Lawal said that according to the partnership document, Dangote will have a majority stake in the venture which is with Jigawa, Kebbi, Katsina and Kano, while the French car maker will hold a 10 percent stake in the local joint venture company and operate the plant. The northern states would provide offtake for cars built at the proposed plant.
Dangote, in alliance with two states and the Bank of Industry, made a bid to acquire a majority stake in PAN in the second quarter of 2017 after the state-bad bank AMCON sought to sell some of the assets it bought in the wake of the banking crisis in 2009.
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Lawal revealed that PAN would start with 3.5 billion naira, and working capital of about 5 million dollars. However, additional capital would be raised. He further said that Dangote and the state governors have visited France to sign the deal.
Meanwhile, Legit.ng reported that the chairman and chief executive officer of Dangote group, Alhaji Aliko Dangote, had been named the African richest person for the seventh year in a row by the Forbes, an American business magazine.
Legit.ng gathered that Dangote who was Nigerian cement and commodities tycoon, with a net worth that Forbes pegged at $12.2 billion is up by $100 million from 2017.
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Source: Legit.ng
