A+ A A-

Dangote bids for Kenya’s ARM Cement

Aliko Dangote, Africa’s richest man and owner of Dangote cement in Nigeria, has revealed to be among bidders for Kenya’s struggling ARM; a cement maker company currently under the administration of accounting firm Price water house Coopers (PwC).

The Nigerian business man, without naming the acquisition target; which in his opinion fits the ARM company, said he is in talks over buying it. “There is a company which has operations in Tanzania, Kenya and Rwanda which we are in talks with to see if we can take it over,” he adds.

Also Read:Cement prices to drop in Tanzania

ARM Cement

ARM portfolio in Kenya includes a clinker and cement grinding plant in Kaloleni and a cement grinding plant at Athi River. The company also manufactures imports and sells cement in Rwanda through its wholly owned subsidiary, Kigali Cement Company. In Tanzania, ARM runs limestone, clinker and cement plants through its subsidiaries, Maweni Limestone Limited and ARM Tanzania.

The company has been facing a number of challenges due to severe electricity rationing, inadequate supply of coal and stiff completion in the market.This has resulted to a negative equity of US $23m meaning that current shareholders will suffer a major dilution if a takeover deal is concluded.

On their side, the PwC said the process of selling ARM or part of its assets was being handled by South African banking giant Absa, which was appointed as the transaction adviser.

“Various parties have been in contact with the administrators expressing interest in the company’s businesses and assets in both Kenya and Tanzania,” the administrators said in a report to ARM’s creditors.

More bids are set to be received until December 3, after which shortlisted firms will be allowed to start their due diligence, including interviewing management.

Dangote Cement

Dangote Cement, which has about a 45% market share in sub-Sahara Africa, has long held interest in venturing into Kenya – with plans underway to build two cement factories by 2021.

Dangote admitted that Kenya is on its priorities and said there are plans to build two plants of 1.5 million tones annually. If the deal sails through, Dangote will take over the manufacturing premises, well-established distribution networks, and mining licenses.

source: constructionreviewonline.com

Visit the best review site bbetting.co.uk for Bet365 site.

©Copyright 2015. Construction Exchange. All rights reserved.