Connect with us

Business News

Kenya’s National Cement to invest $36 million after buying ARM assets

The acquisition will boost its market share to about 15%.

News Central

Published

on

kenya
Photo - Shutterstock

National Cement Company, which this week signed a deal to buy the Kenyan assets of ARM Cement from its administrator, plans to invest $36 million to modernise the production plants it is acquiring, its chairman said on Friday.

ARM, which was once the second biggest cement maker in Kenya behind LafargeHolcim’s Bamburi Cement, was put under administration last August by some of its creditors over debts totalling $190 million. Its shares were then suspended from the Nairobi bourse.

National Cement emerged as the winner of a bidding round to buy the company’s Kenyan assets, including land and plants, agreeing to pay $50 million, ARM’s administrator PWC said on Tuesday.

National Cement, which holds 11 percent of the Kenyan cement market with its Simba Cement brand, wanted to raise its production capacity in the East African nation, where cement consumption has been rising in recent years due to a construction boom.

The eight-year old cement firm was especially keen to have an extra production plant on the Kenyan coast, where it does not have a presence, said National Cement chairman and founder Narendra Raval.

A total of $29 million of the new investment will go towards modernising the “rundown” production plant at the coast, Raval told Reuters.

“It is in pathetic condition,” he said. The balance will be invested in a second plant situated near Nairobi, he said.

The acquisition of ARM’s plants will initially increase National Cement’s 1 million tonne annual capacity by 400,000 tonnes, Raval said.

ARM Cement has an installed annual production capacity at its two plants in Kenya of 1 million tonnes.

The acquisition will boost its market share to about 15%.

National Cement is also interested in buying ARM’s assets in Tanzania and Rwanda, Raval said, without giving details.

George Weru, one of ARM Cement’s administrators, told Reuters it is still considering what to do with those units, with its options including capital injection, a sale of shares or a sale of the assets.

“It’s still a very flexible kind of process,” Weru said, adding that they aim to complete the administration by the August deadline.

ARM Cement slid into losses after investing heavily in its Tanzanian business in 2014, which did not generate a return.

In Tanzania, ARM has a 1.6 million tonnes in annual production capacity at two plants of equal size. Its Rwanda plant produces 100,000 tonnes a year.

Weru said the settlement of ARM’s liabilities will take longer: “We need to get the proceeds and also complete the adjudication of the claims”.

Copyright News Central

All rights reserved. This post and other digital content on this website may not be reproduced, published, broadcasted, rewritten or redistributed in whole or in part without prior express written permission from News Central.

New stories delivered to your phone

Click here to have news stories delivered to your phone or mail. You can also share your stories with us. Join our mailing list here.

Continue Reading
Click to comment

Leave a Reply

Business News

Zimbabwe’s business community calls for economic reform

The Movement for Democratic Change (MDC) had initiated a massive protest against worsening economic conditions

Published

on

Zimbabwe’s business community calls for economic reform
Zimbabwe President Emmerson Mnangagwa. (Photo by Jekesai NJIKIZANA / AFP)

The Zimbabwe business community has called on its government to urgently address ordinary people’s concerns in order to avoid continuous loss of production time through protest shutdowns.

The Movement for Democratic Change (MDC) had initiated a massive protest in central Harare to express growing impatience with the government’s failure to remedy a deepening economic crisis that has pushed many to the edge.

The government, however, insists that the pain caused by its tough policy measures was necessary for an economy which is reeling from decades of mismanagement under former President, Robert Mugabe.

Police moved on Thursday to impose an unpopular ban on the demonstration, setting the stage for ugly clashes with MDC followers.

Copyright News Central

All rights reserved. This post and other digital content on this website may not be reproduced, published, broadcasted, rewritten or redistributed in whole or in part without prior express written permission from News Central.

New stories delivered to your phone

Click here to have news stories delivered to your phone or mail. You can also share your stories with us. Join our mailing list here.

Continue Reading

Business News

Nigeria’s state oil firm awards crude oil swap deals to 15 firms

The awarded oil firms include Vitol, Trafigura, oil major, BP and local downstream companies

Published

on

Nigeria's state oil firm awards crude oil swap deals to 15 firms
NNPC Towers, headquarters of Nigeria's state oil firm in Abuja, Nigeria. (File photo)

Nigerian state oil company, NNPC, has announced that 15 companies have won the right to swap the country’s crude oil for fuels, following a tender for the deals.

About 132 companies made a bid for the deals. The tender for the one-year contracts effective from the 1st of October and dubbed direct sale, direct-purchase (DSDP), was issued in March.

Nigeria is almost entirely reliant on imported fuel due to years of neglect at its own refineries.

It has leaned heavily on the swap arrangements to get fuel, particularly gasoline, as other would-be importers struggle to make money due to price caps.

The Nigerian National Petroleum Corporation says the companies that won the bids are made up of a consortium of 15 companies including Vitol, Trafigura, oil major, BP and local downstream companies.

Since the scheme’s inception in 2016, replacing a program that paid subsidies to importers, the NNPC has said it had saved the country $2.2 billion and supplied some 90 per cent of its import requirements.

Copyright News Central

All rights reserved. This post and other digital content on this website may not be reproduced, published, broadcasted, rewritten or redistributed in whole or in part without prior express written permission from News Central.

New stories delivered to your phone

Click here to have news stories delivered to your phone or mail. You can also share your stories with us. Join our mailing list here.

Continue Reading

Business News

Zambia rejects donor aid amid its worst drought

The government says it has enough corn, the country’s staple food, to last until the next season and won’t need to import

Published

on

Zambia declines donor aid amid its worst drought
(File photo)

Zambia is experiencing its worst drought since 1981, but its government insists that a state of national emergency will not be declared.

Neither will donor assistance be accepted. A Southern Africa Development Community report last month, forecast 2.3 million Zambians will be food-insecure by March after large parts of the southern and western areas of the country received the lowest rainfall since 1981.

Over the same period, the report forecast Zambia will experience an 888,000-ton cereal deficit.

The Zambian government says it has enough corn, the country’s staple food, to last until the next season and won’t need to import.

Retail prices for the cornflour that Zambians consume mostly are already the highest since at least, 2003, according to data from the national statistics agency.

In July, prices were 41 per cent higher than the same time last year, helping to push inflation to 8.8 per cent, the highest since November 2016.

Copyright News Central

All rights reserved. This post and other digital content on this website may not be reproduced, published, broadcasted, rewritten or redistributed in whole or in part without prior express written permission from News Central.

New stories delivered to your phone

Click here to have news stories delivered to your phone or mail. You can also share your stories with us. Join our mailing list here.

Continue Reading
Advertisement

Newsletter

Trending