National Cement Holdings Ltd, one of the largest cement manufacturers in East Africa, has completed the acquisition of CIMERWA Plc at $85 million (approx. Rwf107 billion), promising to soon make Rwanda a cement import-free country.
The completion of acquisition 99.94 percent stake in CIMERWA was signed on, January 25, in the presence of senior officials of National Cement, PPC International Holdings Proprietary Ltd and minority shareholders including Rwanda Social Security Board (RSSB), Agaciro Development Fund, Rwanda Investment Group and Sonarwa Holdings Ltd.
The decision was first announced in November 2022, with officials saying the move represents a milestone for the industry in Rwanda, as its first and sole integrated cement producer becomes majority-owned by a company with a solid foothold in the East African region and strong growth ambitions in tune with the region’s infrastructure development imperative.
Narendra Raval, Chairman of Devki Group, said that besides the $60 million investment they will make in the first year as majority owners, the intention is to also improve service delivery, availability and affordability of cement in the country.
"Being an East African company, I am well aware of the problems of the region and you have a very energetic President who wants the country to stop being a net importer. Under that direction, my company helped Kenya stop importing cement over the past seven years. Same thing for Uganda. I promise to make Rwanda import-free, with the help of the government.”
According to him, this will be achieved by expanding the firm&039;s productivity, making cement affordable and competitive against external importers in the market.
National Cement is part of the Devki Group of companies, a conglomerate boasting a diverse portfolio in cement, steel, roofing materials, fertilizers, and packaging materials.
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James Oduor, CEO of CIMERWA, noted that the cement producer has made a tangible impact, beyond infrastructure investment, with contributions across the value chain to an estimated impact on 5,000 households.
He added that this transition means leveraging the regional network, financial and technical expertise to accelerate the implementation the firm’s vision that has been driving the company’s strong growth over the past years.
Despite the economically challenging year, CIMERWA registered a record-breaking total revenue of Rwf103 billion in 2023, representing a 12 per cent increase from the previous year, raking in Rwf15.6 billion in Profit after Tax.
"We see the National Cement coming in to augment a lot of things we have been able to do as a business and it's quite positive for the company and the country in terms of the future of cement in Rwanda.”
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Regis Rugemanshuro, former Chairman of CIMERWA, said that selling shares in a profitable company is part of business strategy and Devki group has the capacity and resources to spur further the growth of the firm.
"It gives confidence that the development ambitions of the country, especially, in infrastructure sector will be supported by a larger operating CIMERWA.”
Pierre-Celestin Rwabukumba, CEO of Rwanda Stock Exchange, dismissed reports that said the company was delisted from the local stock market, noting that it is still listed, and the owner will decide the way forward for the 49 percent free float stake.
Established in 1984, Rwanda’s first and only integrated cement manufacturer has a production plant in Bugarama, Rusizi District with a production capacity of 600,000 tonnes, currently utilized at 92 percent.