Africa's Richest Man Aliko Dangote Loses $7.8 Billion As Naira in Stock Market

The naira devaluation by nearly 10% by the Governor of the Central Bank of Nigeria, Godwin Emefiele , at N187 to $1 after a nose dive world oil prices and dwindling dollar reserves were making it difficult to defend the value of the currency. This  devaluation has knocked more than $40 billion off the value of Nigeria’s economy,  Forbes report.
 

Aliko Dangote, Africa’s richest man, is the biggest loser among Nigeria’s richest people as the Naira’s slump, coupled with falling stock prices. Dangote was worth $25 billion in February but as of market close on Tuesday, he’s worth $17.2 billion. More than half of the drop in his fortune has happened since early November.

The reason is because in the last few weeks have been a bit of a disaster for many companies listed on the Nigerian Stock Exchange. Several blue-chip stocks such as Dangote Cement, Zenith Bank, Transcorp and United Bank of Africa among several others have hit one-year-lows as a result of the fall in oil prices, a general uncertainty regarding the 2015 general elections, Central Bank regulatory headwinds, and weak earnings from large cap companies. These have all contributed toward putting naira-denominated assets including equities at risk.

This is whipping up negative market sentiments as foreign and institutional investors such as pension funds who hold equity stakes in companies (due to their large cap and liquidity status) have mostly fled their positions,” says Ugodre Obi-Chukwu, a leading financial analyst and publisher of Nairametrics, a website that provides analysis and opinion about Nigerian stocks, investing, personal finance and the economy.

Dangote Cement, Africa’s largest manufacturer of cement has shed close to 40% of its market value between the beginning of November and now. The company’s stock, which was trading at N215 ($1.15) at the beginning of November, is now valued at N165 (88 Cents) as at Monday. Between the time FORBES published the list of Africa’s 50 Richest and today, Dangote, has lost more than $4 billion in his net worth.

After Dangote, the second biggest loser among Nigeria’s ultra-rich is Tony Elumelu, the Chairman of Heirs Holdings, an investment company. Heirs Holdings has lost an estimated $345 million in paper value on Transcorp, and its stake in the company as at Monday is now worth roughly $400 million, down from $700 million. Elumelu’s investments in other listed companies like UBA, Africa Prudential PLC and UBA Capital have shed a little over $27 million in value.

Other big losers include Nigerian multi-millionaire banker Jim Ovia, a co-founder of Zenith Bank. The value of his stake in the financial services provider is $240 million as of late Monday, down from more than $350 million last month. He owns a 9% stake in the bank.