• Bamburi Cement’s majority shareholder, Holcim Group, has announced the sale of its shares in the country’s largest cement maker
• The Swiss multinational construction company owns 58.6% of Bamburi through Fincem Holding Limited (29.3%) and Kencem Holding Limited (29.3%), with the remainder belonging to investors.
• Controversy sparked the sale of the majority stake after Savannah Clinker Limited completed the deal, competing with Tanzania’s Amsons Group.
• The battle between the two investors leaves the rest of Bamburi Cement shareholders at a crossroads

The sale of Bamburi cement takes a difficult turn after new details revealed controversies over the financial capabilities of bidding investors.

Holcim Group announced the sale of its shares in the the largest cement manufacturer in the country.

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The Swiss multinational construction company owns 58.6% of Bamburi through Fincem Holding Limited (29.3%) and Kencem Holding Limited (29.3%), with the remainder belonging to investors.

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Kenyan company Savannah Clinker Limited has made a competing bid to acquire 100% of Holcim’s shares, outbidding Tanzania-based Amsons Group.

Savannah Clinker, owned by Benson Ndeta, offered to buy Bamburi Cement shares at KSh70.00 per sharea higher offer than the Tanzanian Amsons group’s offer of KSh 65 per share.

The offer includes a commitment to retain Bamburi Cement’s existing management team and employees.

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However, controversy sparked the sale of the majority stake after Savannah Clinker Limited announced a KSh27 billion takeover offer for Amsons’ Sh23 billion bid.

Ndeta, the former CEO of Savana Cement and East African Portland Cement, is raising questions among industry players over his and Savanah Clinker Limited’s ability to run the Nairobi Securities Exchange (NSE) listed company.

Business Daily reported that the two Ndeta-led companies are facing financial constraints and owe their debtors KSh18 billion.

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According to a market filing, Savannah Clinker Limited’s funding source is raising eyebrows among industry players.

By a press release via his Bank Faida Investment, Savannah Clinker Limited said the funds will be provided by a US entity called Global Infrastructure Finance & Development Authority Inc. (GIFDA).

For the role of Amsons, KCB The bank provided proof of availability of funds intended to finance the acquisition as well as a bank guarantee.

What is the behavior of the American company involved in the sale of Bamburi

Faida Investment Bank’s failure to prove and guarantee the existence of the funds raises questions about whether the funds actually existed and the motivations for Savannah Clinker’s offer.

GIFDA’s activities as a non-profit company and the lack of media coverage of its commercial activities also raise questions.

This calls for extreme caution from potential investors and stakeholders in the Bamburi Cement bid.

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Why the interest of small shareholders is important

The battle between the two investors leaves the rest of Bamburi Cement’s shareholders at a crossroads.

The Capital Markets Authority (CMA) should carry out due diligence to ensure that the rest of the stakeholders do not fall into the wrong hands.

Meanwhile, Bamburi Cement’s stock price on NSE increased following the Amsons Group offer.

The company recorded a gain of 28.33% at the close of trading on the Nairobi Stock Exchange (NSE), with shares rising from KSh49.60 in the morning to KSh57.75 in the evening of July 11.

Source: TUKO.co.ke