Pakistan-based cement producer DG Khan Cement Company (DGKC) has signed a Memorandum of Understanding (MoU) to acquire a majority stake in an upcoming Mozambique cement producer.
DG Khan has informed the Pakistan Stock Exchange that it has entered into a MoU with Sumaria Cement Holdings Ltd of Mauritius to acquire a 57.5 per cent shareholding In GS Cimento which is plans to construct a 0.55Mta cement plant in Mozambique.
The total consideration for the deal is US$8.625m, which may be revised following due diligence of the target company.
In 2008, Sumaria holdings acquired full ownership of GS Cimento which already owns 760ha of land for the construction of a fully integrated cement plant.
Following the due diligence, the exact value of the investment and DG Khan’s stake will be announced. If the acquisitions proceeds as planned, DG Khan will redetermine the size of the plant as well as source funding for the project and select an equipment provider.