Displaying items by tag: Zambia

Zambia: China-based Huaxin Cement has increased its stake in Chilanga Cement (formerly Lafarge Zambia) to 81%. The Times of Zambia newspaper has reported that the group previously owned a 75% share of the producer.

Egypt: Lafarge Egypt has appointed Jimmy Khan as its chief executive officer (CEO).

Khan has worked for Holcim, LafargeHolcim and Lafarge for 18 years. Notable positions include becoming Head of Business Processes, Internal Control and Audit - Nigeria in 2013, CEO of LafargeHolcim Mauritius and Seychelles in 2015 and Country CEO of Zambia in 2018. He is a graduate of the Pamplin College of Business at Virginia Tech in the US.

Zimbabwe: Livetouch Investments plans to invest US$100m in the construction of an integrated cement plant. The Herald Zimbabwe newspaper has reported that the group plans to establish the new facility in phases, with the first phase costing US$15 – 20m. The phase will include the exploration of possible locations for the plant with suitable limestone resources, which could then also supply its Redcliff grinding plant. The grinding plant currently imports 4000t/yr of Zambian clinker and also buys raw materials from Lafarge Zimbabwe.

Managing director Kyle Wang said “We are still limited by the limestone resources in the country.” He said that the company has identified ‘good limestone deposits’ in Rushinga, Nyamapanda, Bulawayo and Masvingo, however “The problem with some of the limestone is the quality.”

Zambia: Zambezi Portland Cement is facing fresh legal proceedings over its ownership. The Lusaka Times newspaper reports that proceedings at the Court of Appeal are ongoing against businessman Phesto Musonda. Musonda, a former director of the company, allegedly attempted to take control of part of the company’s plant in September 2021. Unrest has also been reported at the cement producer’s plant with youths throwing stones at workers.

The current owners of Zambezi Portland Cement, the Ventriglia family, previously won a 10-year battle of control of the company against businessman Rajan Mahtani. In 2018 the High Court of Zambia awarded the family full ownership of the business.

Malawi/Zambia: Huaxin Cement says it has completed its acquisition of Lafarge Zambia and Lafarge Cement Malawi. In late December 2021 the Chinese cement producer completed the equity delivery conditions for Lafarge Cement Malawi. This follows a similar process for Lafarge Zambia in late November 2021.

In June 2021 Huaxin Cement said it had agreed to spend US$150m on purchasing a 75% stake in Lafarge Zambia and US$10m on acquiring Pan African Cement from Lafarge Cement Malawi. The former operates two integrated cement plants in Zambia with a combined production capacity of 1.5Mt/yr. The latter operates a 0.25Mt/yr grinding plant at Blantyre in Malawi. Following the completion of the takeover Huaxin Cement now intends to increase its cement grinding capacity in Malawi by 0.25Mt/yr.

Zimbabwe: Industry and Commerce Minister Sekai Nzenza says that the government will continue to issue cement import permits until local production returns to normal. The situation has been blamed on a breakdown at Lafarge Zimbabwe’s cement plant, according to the Herald Zimbabwe newspaper. The company is importing cement from Zambia to compensate. A roof collapse over the mill at Lafarge Zimababwe’s Manresa plant was reported in October 2021.

Zambia: Huaxin Cement has concluded its acquisition of Holcim's Zambian business. The business consists of a 75% stake in Lafarge Zambia. The company is reported to have a total value of US$150m. Both Chinese and Zambian competition authorities have now approved the deal.

Holcim's chief executive officer Jan Jenisch said "This divestment is another step in our transformation to become the global leader in innovative and sustainable building solutions, giving us the flexibility to continue investing in attractive growth opportunities. Huaxin has been a trusted partner for many years and we see the company as an ideal owner to further develop the business in Zambia."

In 2020 and the first 11 months of 2021, the Switzerland-based group received US$3.1bn from divestments.

Switzerland: Holcim’s sales rose by 17.4% year-on-year to Euro11.7bn in the first half of 2021 from Euro9.92bn in the same period in 2020. Its recurring earnings interest before taxation (EBIT) increased by 66% to Euro1.84bn from Euro1.12bn. Cement and concrete sales volumes grew by 13.5% to 99Mt and 15.6% to 22.1Mm³ respectively. Sales of all business segments grew in all regions on a like-for-like basis with the exception of aggregate sales in North America, where they fell slightly.

Jan Jenisch, the chief executive officer of Holcim, said, “In the first half of 2021 we set new records in recurring EBIT, free cash flow and earnings per share.”The group’s acquisition of Firestone Building Products officially closed at the end of March 2021 and the company has also made seven ‘bolt-on’ acquisitions so far in 2021, mainly in aggregate and ready-mixed concrete markets in Europe and North America. The group also agreed to divest operations in Zambia, Malawi and the Indian Ocean in the reporting period and these are all expected to complete by the end of 2021.

The latest piece of China-based Huaxin Cement’s global ambitions slotted into place this week with the news that it is preparing to buy plants in Zambia and Malawi. Its board of directors has approved plans to spend US$150m towards acquiring a 75% stake in Lafarge Zambia and US$10m on a 100% stake in Lafarge Cement Malawi. The move will gain it two integrated plants with a combined production capacity of 1.5Mt/yr in Zambia, and a 0.25Mt/yr grinding plant in Malawi.

This latest proposed acquisition represents the next step for Huaxin Cement in Africa following its purchase of African Tanzanian Maweni Limestone from ARM Cement in mid-2020. The company has also been busy along the more traditional Belt and Road Initiative land routes in Asia. It started up the kiln at its new 2Mt/yr Jizzakh cement plant in mid-2020. Elsewhere in Central Asia it runs two plants in Tajikistan and one plant in Kyrgyzstan via various indirectly-owned subsidiaries. While in South Asia it runs a plant in Nepal and in South-East Asia it runs one in Cambodia. If the plans in Zambia and Malawi pay off then it will give the Chinese producer a growing presence in East Africa, with plants in three countries.

The China Cement Association ranked Huaxin Cement as the country’s fifth largest clinker producer in 2021 with an integrated capacity base of just under 63Mt/yr. Domestically, the company operates 57 cement plants and most of these are based in the Yangtze River Economic Belt region. In 2020 it reported cement and clinker sales of 76Mt, a small decrease from 2019. Its operating income fell by 6.6% year-on-year to US$4.58bn and profit dropped by 12% to US$1.2bn. This performance was blamed on the emergence of Covid-19 at the start of 2020 and then floods later in the year.

Compared to the other larger Chinese cement producers, Huaxin Cement roughly appears to be holding rank with its overseas expansions. The leaders, CNBM and Anhui Conch, hold subsidiaries with plants in South-East and Central Asia and CNBM’s engineering wing, Sinoma, has a far bigger reach, building plants all over the place. Information has been scarce since mid-2020 on the long heralded 7Mt/yr plant in Tanzania due to be built by Sinoma and local subsidiary Hengya Cement. At that time local residents in Mtimbwani, Mkinga District were reportedly being compensated for their land. Other than this, one of the other big players internationally is Taiwan Cement. In 2018 it invested around US$1.1bn for a 40% stake in Turkey-based Oyak Cement. As well as a presence in Turkey this also gave it a share of plants in Portugal in 2019 when Oyak completed its acquisition of Cimpor.

Elsewhere this week, carrying some of the themes above with expansion in Central Asia, two new integrated cement plant projects were announced in Kyrgyzstan and Turkmenistan respectively. Meanwhile, Italcementi said it will invest Euro5.0m to restart clinker production at its Trentino cement plant in Sarche di Madruzzo, Italy. The unit has been operating as a grinding plant since 2015. This might be viewed as an unexpected decision considering the high local CO2 price but it shows some level of confidence in the local market by Italcementi and its parent company, HeidelbergCement. The next step will be when or if a European producer decides to build a brand new integrated plant in Italy or elsewhere.

Malawi/Zambia: China-based Huaxin Cement plans to spend US$160m towards buying cement plants in Zambia and Malawi. It intends to spend US$150m on purchasing a 75% stake in Lafarge Zambia and US$10m on acquiring Pan African Cement from Lafarge Cement Malawi. The former operates two integrated cement plants in Zambia with a combined production capacity of 1.5Mt/yr. The latter operates a 0.25Mt/yr grinding plant at Blantyre in Malawi. The acquisition is subject to regulatory approval in each of the relevant countries.