The Cimerwa cement plant in Rwanda
JSE-listed construction materials supplier PPC has concluded an agreement to sell its 51% shareholding of Rwandan integrated cement manufacturer Cimerwa for $42.5-million to Kenya-based National Cement, which is part of East Africa clinker and cement manufacturer Devki Group.
The divestment forms part of PPC’s strategy to focus on its core Southern African markets and will use the proceeds from the transaction in line with its capital allocation priorities and optimal gearing levels.
“This represents another step in the execution of our communicated strategy and enables PPC to focus efforts and resources on its core Southern African markets. With the proceeds from this transaction, PPC will have further optionality in deciding the best approach to allocate capital that delivers enhanced value for our stakeholders,” PPC CEO Roland van Wijnen said in a November 17 statement.
“Importantly, we consider National Cement to be well-placed as a strong regional player with the financial and technical resources to continue to develop and strengthen Cimerwa's position in Rwanda and the broader East African region,” he added.
“We look forward to welcoming National Cement as our new shareholder. We are pleased to have secured a highly respected and like-minded new owner that has a leading position in the East African region and will see Cimerwa grow and expand in line with our vision.
"We would like to thank PPC for their support over the years and reiterate our commitment to building on the successes we have achieved to date and to enhancing our positive impact in the region,” Cimerwa chairperson Regis Rugemanshuro said.
“We are committed to contributing to the growth of Rwanda and look forward to the integration of Cimerwa into our network of other cement factories in the region. We believe in the potential for this business and its people and are excited by the opportunity to support infrastructure development in the region in line with our strategic expansion ambitions,” noted Devki Group chairperson Dr Narendra Raval.
PPC's share price on the JSE rose by more than 5% on the news.