ARM Cement has completed the sale of 40 per cent of its shares to CDC Group, a UK-owned development corporation, for KES14.1bn (US$139m), Capital Business reports.
The investment will strengthen ARM’s financial structure and enable the company develop to meet the growing demand for sustainably produced cement across sub-Saharan Africa. In the short-term, CDC will support the company’s plans to expand cement production in Mwingi in central Kenya, helping to bring down the cost of cement to customers based away from the traditional coastal producers.
CDC's investment will enable ARM to boost its production capacity and create new jobs. The supply chain of SMEs that transport the company's raw materials and provide general services will also benefit economically from the company’s growth.
"CDC’s investment in ARM Cement can provide the building blocks for the growth of infrastructure and housing in East Africa. This investment will strengthen a company making a difference to the local economy, bringing jobs and lower cost raw materials to a region traditionally dependent on imports. ARM has the potential to become one of sub-Saharan Africa's most successful companies, providing a platform to expand into neighbouring countries while bringing world-class environmental standards and highly efficient plant – an approach that is central to CDC’s investment strategy," said Mark Pay, CDC's managing director, Equity Investments.
"This is a significant milestone for in ARM's journey. We chose CDC as an investor and partner to help us achieve a shared vision of creating the leading and lowest-cost East African Cement business. Together we will focus on shareholder value creation and on positive developmental impacts for our communities and stakeholders," said Pradeep Paunrana, managing director of ARM.