Athi River Mining has been sold to Devki’s National Cement Company (NCC) allowing steel magnate Narendra Raval ‘Guru’ to expand his empire to the industry’s second-largest manufacturer. This brings the end of 45-year leadership by the Paunrana family.
“We are happy to inform you today that we have been able to complete the ARM acquisition and cleared all the transaction cost amounting to Sh5 billion (US$50m) to the PwC,” said Mr Raval.
Speaking during the handover ceremony, Mr. Raval said 1,100 employees of the embattled firm which has since been suspended from trading at the Nairobi Securities Exchange will be retained by the new operator, National Cement Company.
Raval said the decision to retain all affected staff was deliberately anchored in Devki Group’s resolve to protect their livelihoods and support job creation.
Part of the outstanding debt includes Sh4.6 billion (US$46m) convertible debt owed to the African Finance Corporation, Sh2.5 billion (US$25m) in overdraft facilities owed to Stanbic Bank as well as Sh824 million (US$8.2m) owed to Standard Bank Ltd.
In 2017, the firm took additional overdraft facilities from Guarantee Trust Bank and UBA Bank valued at Sh550 million (US$5.5m) and Sh340 million (US$3.4m) respectively.
ARM has been in deep problems and has for some years been navigating financial and management turmoil, which at some point made the future of the company uncertain.