Displaying items by tag: Kenya

Kenya: Data from the Kenya Bureau of Statistics shows that cement production fell by 6% year-on-year to 1.46Mt in the first quarter of 2019 from 1.55Mt in the same period in 2018. Cement consumption dropped by 3% to 1.46Mt from 1.50Mt. Cement consumption previously grew by 2.8% year-on-year to 5.9Mt in 2018 from 5.8Mt in 2017. However, production fell by 2.6% to 6.07Mt from 6.23Mt. Imports increased by around 50% to 23,000t but exports decreased by 63% to 0.14Mt from 0.39Mt, mainly due to a major drop in deliveries to Uganda and Tanzania.

Kenya: The East African Portland Cement Company (EAPCC) plans to reduce its costs by making 220 workers redundant. It says it needs US$170m to return to profitability, according to the Business Daily newspaper. Other plans to reduce its debts include raising money through land sales and reducing its energy costs. It is considering selling over 2400 hectares of land in Athi River. It has already sold around 360 hectares to Kenya Railways for around US$50m.

The company currently has 821 contracted and permanent and pensionable employees. It intends to reduce its workforce by September 2019.

Kenya: East Africa Portland Cement has appointed Stephen Nthei as its acting managing director. He succeeds Simon Peter Ole Nkeri, who was relieved of the role by the company’s board, according to the Standard newspaper. Nthei joined the company in 2007 and has held various roles, including Head of Internal Audit and Head of Financial Management. He is a Certified Public Accountant with experience working for bodies including Ernst & Young, the Central Bank of Kenya and Kenya Petroleum Refineries.

Kenya: Bamburi Cement has paid a US$3m settlement to the Kenya Revenue Authority in a long-running dispute. The figure is significantly less than the US$38.5m the tax authority originally demanded in 2012, according to the Business Daily newspaper. However, the cement producer still owes US$2.8m in penalties, although it has applied to have this waived.

Kenya: ARM Cement has signed a deal to sell its business in Kenya to the National Cement Company for US$50m. The transaction is subject to customary regulatory approvals, according to the Business Standard newspaper. ARM Cement also has operations in Tanzania, Rwanda and some interests, in the form of unexploited mineral deposits, in South Africa.

“This transaction is in line with National Cement’s growth strategy in Kenya to position itself as the leading cement manufacturer in the region. The industry is poised for growth and we are excited about the prospects for this next chapter of our business. We will endeavor to safeguard the interests of all stakeholders including the employees, customers, and suppliers in the overall interest of Kenya,” said Narendra Raval, chairman of National Cement.

The cement producer was placed under administration in August 2018. In late 2018 Oman’s Raysut Cement said it planned to buy ARM Cement as part of its expansion plans. Nigeria’s Dangote Cement was also linked to a potential purchase of the company.

Kenya/Tanzania: The governments of Kenya and Tanzania are working together to resume exports of cement. A delegation of Tanzanian officials are due to inspect cement plants in Kenya to verify the source of the raw materials used in their manufacture, according to the East African newspaper. This could then lead to exports of cement from Kenya to Tanzania to be re-allowed.

The two countries recently held bilateral trade talks in Arusha on non-tariff barriers. They agreed to speed up the verification missions recommended for confirmation of product origin as provided for in the East African Community rules of origin. Tanzania blocked cement despatches from Kenya in 2018 due to the use of imported clinker.

Kenya: Bamburi Cement’s profit before tax fell to US$6.73m in 2018 from US$40.7m in 2017. Its turnover rose by 4% to US$369m from US$356m. Its cement volumes grew by 5%. It blamed the drop in profits on increasing energy and raw material costs. The subsidiary of LafargeHolcim noted that the market delinked by 5% in Kenya, its primary market, and was ‘flat’ in Uganda. It also noted ‘increased competitive pressure’ due to cement grinding production capacity and the ‘shrinking’ market.

Kenya: Employees of the East African Portland Cement Company (EAPCC) have filed an application at the Court of Appeal to jail the company’s directors for not paying them. The workers argue that, despite both the labour and appellate courts having directed that they be paid, the company directors have failed to comply, according to the Business Daily newspaper. Over 400 workers were awarded nearly US$14m under a 2012 - 2015 collective bargaining agreement (CBA).

Kenya/South Africa: Kenya’s ARM Cement is fighting moves by minority investors in South Africa’s Mafeking Cement to buy it out for a nominal sum. ARM Cement is attempting to sell its 70% stake in the company for around US$3m as part of its administration process, according to the Business Daily newspaper. Mafeking Cement owns limestone reserves in north-west South Africa and ARM Cement originally took a stake in the company to raise investment and eventually build a cement plant.

However, the minority investors have invoked parts of the shareholders’ agreement and filed a court application in South Africa that, if successful, would allow them buy out ARM Cement’s stake for a nominal price less than US$1. ARM Cement’s administrators PricewaterhouseCoopers have taken steps to counter the move.

Kenya: The Competition Authority of Kenya (CAK) has approved the acquisition of Cemtech by Simba Cement. CAK said that, as Cemtech had been dormant for a decade, its purchase would revive the company, create jobs and improve the economy in West Pokot County.

Simba Cement is a subsidiary of Devki Group and it trades under the National Cement brand. Cemtech is a subsidiary of India’s Sanghi Group. It has been attempting to build a cement plant in West Pokot since 2010. The acquisition includes Cemtech’s land, business intellectual property, business records, equipment, goodwill, licenses, stock and third party rights.

Data from the Kenya National Bureau of Statistics used by CAK showed the leading companies in the country’s cement sector by market share were: Bamburi Cement (33%), Mombasa Cement (16%), East African Portland Cement (15%), Savannah Cement (15%), National Cement (8%) and Athi River Mining Africa (13%).