Dangote Cement and Sephaku Holdings announced yesterday that they have entered into a shareholders agreement for Sephaku Cement that will see the building of a 2.2Mt cement plant in South Africa. The deal was first announced in April of this year, and saw Dangote acquiring a 19.8 per cent stake in Sephaku Cement through a private placement, proceeds of which will be used to part-finance the building of the plant.
The agreement that was signed in London on October 1, 2008 by the Sephaku Chairman, Dr Lelau Mohuba and Dangote Chairman, Alhaji Aliko Dangote laid the foundation for the relationship between Dangote Cement, Sephaku Holdings and Sephaku Cement, (in which Dangote Cement will eventually hold a 45 per cent equity stake).
Dangote Cement is part of Nigeria’s largest diversified group, Dangote Industries Limited, while Sephaku Cement forms part of the industrial division of privately held Sephaku Holdings, which interests also include mining and investment holdings. Dangote Cement is expanding its operations across Africa, with current projects in Senegal and South Africa and negotiations are taking place in a number of other African countries as Dangote Cement puts in place the infrastructure necessary to achieve its target of 50Mt of production capacity by 2012.
The joint venture is now in discussions with technical partners before construction commences. Sephaku Holdings, which, has 55 per cent shareholder, shall provide a majority of Sephaku Cement management.