Dubai-based Onyx Group owned by Sri Lankan businessman, Nandana Lokuwithana, is said to have joined bidders in the process to buy Holcim Lanka Ltd, according to Business Standard.
There are six leading bidders for the Sri Lankan cement producer from China, the UAE, Indonesia, Thailand and Sri Lanka. Binding bids have been received from several companies with final negotiations to be concluded shortly.
Business Standard cites that Lokuwithana, who is also the owner of Ceylon Heavy Industries and Construction company (CHICO), has bid US$400m to buy Holcim Lanka Ltd, which is valued at only US$200m. The Onyx's bid is reportedly backed by a comfort letter issued by a State Bank of Sri Lanka in the same amount.
Holcim Lanka Ltd has a total cement manufacturing and bagging capacity of around 3.9Mta and is the only integrated cement plant in Sri Lanka with access to captive limestone mines. It is seen as an attractive strategic buy.
Sri Lanka has an overall market of around 6.5Mta, while China has a 474Mta capacity and a keen desire to export its cement.