KENYA – The Competition Authority of Kenya (CAK) has approved the acquisition of Cemtech Limited a Kenyan cement business by Simba Cement Limited in a move that is set revamp the factories operations after several failed attempts to start operations.
The regulator gave Simba Cement, a subsidiary of the Devki Group of Companies, the go-ahead to buy 100 percent of the business and assets of Cemtech owned by Indian conglomerate Sanghi Group.
According to a reports by Business Daily Devki Group will acquire all Cemtech’s land, intellectual property, business records, equipment, goodwill, licences, stock and third party rights for an undisclosed amount of money.
Cemtech has limestone and clay deposits, and the requisite licences in rift valley region with the merged entity expected to have a market share of eight percent, CAK revealed.
“We are still negotiating with Cemtech and we hope to close the deal soon. We are eager to venture into West Pokot to change its perception and the lives of its people for the better,” said Narendra Raval, founder and chairman of Devki Group.
“The Authority considered that Cemtech has been dormant for a decade. Its shareholders have been looking a strategic partner to finance construction of a cement plant.
The proposed acquisition is therefore expected to resuscitate the dormant firm, create jobs and raise the economic profile of West Pokot County
Premised on the fact that the transaction is unlikely to raise negative competition or public interest concerns, the authority approved the proposed acquisition of Cemtech Company Ltd by Simba Cement Company Ltd,” said CAK.
Simba Cement trades under the brand name National Cement.
Data from the Kenya National Bureau of Statistics (KNBS) indicates that the market players in Kenya’s cement sector, and their respective market shares are: Bamburi Cement Limited 33%; Mombasa Cement Limited 16%; East African Portland Cement Company 15%; Savannah Cement 15%; National Cement 8%; and Athi River Mining Africa Limited 13%.
In January, the construction materials manufacturer inked a US$252.68 million deal with Chinese firm Sinoma Energy to power its Mombasa-based raw steel processor and the new Athi River cement clinker plant.