Switched on to Africa
HeidelbergCement will soon complete US$400m worth of investment in its nine cement operations active in the sub-Saharan region, which will see production capacity rise by more than 50 per cent to 10.35Mt by 2014. Going forward, sub-Saharan Africa (SSA) remains a key area for the group, and because of its high growth potential, it is earmarked for further investment by the German major. In this exclusive interview, ICR catches up with Jean-Marc Junon, chief operating officer for HeidelbergCement in Africa, to discuss the status of the company’s activities on the great continent and why the future looks bright.
The history of HeidelbergCement in Africa dates back to its acquisition of Scancem in 1999, and Scancem International’s Africa-business even dates back to the mid-60s. Scancem International was established in 1986 by the Norwegian cement company Norcem and the Swedish cement company Euroc as a 50/50 joint venture to handle their international cement activities, which included the US, UK, and Sub-Saharan Africa. In 1995, Norcem and Euroc were merged creating the Scandinavian cement group Scancem. In 1999, Scancem – which by then had a turnover of €1.98bn – was acquired by HeidelbergCement for around €2.4bn, providing the German company an enviable foothold in sub-Saharan Africa.
For HeidelbergCement, Africa constitutes an important part of their emerging market strategy. With profitable plants ideally located in several high-growth SSA markets, HC Africa is now a top priority within the group, which is investing in brownfield expansions, new greenfield capacities and in entering new markets.
ICR: For how long has HeidelbergCement operated in Africa?
J-MJ: HeidelbergCement began operating in Africa through Scancem International, at Tema in Ghana in 1967.
When HeidelbergCement acquired the company, Scancem had cement facilities in Sweden, Norway, UK and the US, but Africa did not represent such a large share at that time. In the beginning it was mainly an outlet for surplus capacity from Europe. Today, Scancem represents the consolidated activities of HeidelbergCement in Africa with operations in nine countries from Sierra Leone in the west to Tanzania in the east. The largest markets for us are currently Ghana and Tanzania.