Displaying items by tag: Loan

Kenya/Tanzania: The administrators of ARM Cement have written off loans worth around US$210m to Maweni Limestone, a subsidiary in Tanzania. The decision by the PricewaterhouseCoopers (PWC) administrators has significantly reduced the cement producer’s assets to US$140m from US$362m, according to the Business Daily newspaper. In a report PWC alleges that ARM Cement had treated its debt to Maweni Limestone as a performing loan, despite the fact that the subsidiary had repeatedly defaulted on it, effectively misleading investors as to the value of the company. The write-off has left ARM Cement’s creditors, including the UK government-backed CDC Group, in negative equity to a value of around US$24m.

Other irregularities that have been discovered amount to US$1.5m. These issues include alleged outstanding director pay, payments to mystery customers and a payment of US$0.4m for ‘fixtures and fittings.’

ARM Cement owns an integrated cement plant at Tanga and a grinding plant in Dar es Salaam that is currently not in operation. It is also building a grinding plant in Tanga that remains unfinished. The cement producer was placed into administration in late August 2018.

Kenya: The International Finance Corporation (IFC) is set to take over loans worth US$120m at ARM Cement. UK-government investor CDC Group, which owns a 41% stake in the cement producer, will also loan it US$20m, according to the Business Daily newspaper. The IFC loan is expected by mid-2019 and the CFC loan will arrive by the end of September 2018. The IFC has also proposed a US$50m equity investment in ARM Cement but chief executive Pradeep Paunrana wants to wait until his company’s share price returns to normal to avoid the company being undervalued.

The cement producer reported a loss of US$55m in 2017 due to poor demand in Kenya and Tanzania. It said it was undergoing a ‘significant’ review of its current operations, asset base and financing structure to address its problems.

Pakistan: Power Cement plans to take out a Euro30m loan from Germany’s Deutsche Investitions to finance building a 7700t/day new clinker production line. In mid-2017 the cement producer ordered a production line from Denmark’s FLSmidth for a third line at its plant at Nooriabad.

Mexico: Grupo Cementos de Chihuahua (GCC) has taken out a new US$400m loan to reduce its interest payments. The loan has a term of five years with a margin of 1.25 – 2% on Libor, based on the debt / earnings before interest, taxation, depreciation and amortisation (EBITDA) ratio, according to the El Financiero newspaper. The initial margin will be 1.75%. The loan has been supplied by BBVA Bancomer, Banco Nacional de México, JP Morgan Chase Bank and the Bank of Nova Scotia. It will also be used for general corporate purposes.

Philippines: Phinma Corporation has secured a US$16.7m loan for its cement business, PhilCement, to build a terminal at Mariveles in Bataan. The five-year fixed term loan agreement was signed with Security Bank on 1 June 2018, according to Business World. PhilCement was set up in September 2017. Phinma Corporation owns a 85.7% stake in the business.

Ivory Coast/Senegal: The West African Development Bank (Board) has approved loans for cement plant projects in Ivory Coast and Senegal. It will give US$47m to Ciments Du Sahel for it to build a third clinker production line at its plant in Kirène. The new line will have a production capacity of 2.7Mt/yr. It has also approved a loan of US$9.4m for Ciments de Côte d’Ivoire (Cimivoire) to build a new 3Mt/yr cement grinding plant in Abidjan.

Egypt: The Arabian Cement Company (ACC) has successfully rescheduled a US$30.9m loan from the National Bank of Egypt. The loan will now be paid in quarterly instalments to mid-2021, according to the Daily News Egypt newspaper. The borrowing was originally taken out to expand its production faculties.