In a substantial Ksh 18 billion deal, the Sarrai Group, led by billionaire Sarbjit Singh Rai, has achieved a significant breakthrough in the cement industry.
The Nairobi Securities Exchange (NSE) has revealed that the Sarrai Group, in collaboration with Rwimi Holdings, plans to acquire Bamburi Cement's stake in its operations in Rwanda and Uganda.
The focus of the $120 million (Ksh 18 billion) agreement is the acquisition of 1,335,600 common shares in Hima Cement Limited, a major player in Uganda with operations extending into Rwanda.
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Sarrai Group and Rwimi Holdings are making efforts to secure a complete 100% stake, exceeding Bamburi Cement's substantial 70% controlling interest. This marks a strategic shift.
The approval of the acquisition is pending from the Capital Markets Authority (CMA) and other regulatory bodies. Additionally, crucial approval from Bamburi Cement's shareholders, who form another significant group of stakeholders, is required for the deal to proceed.
After a prosperous acquisition, Hima Cement Limited, along with its subsidiaries, including Hima Cement Rwanda Limited, will become part of the Sarrai Group instead of the Bamburi group.
It appears that Bamburi Cement, by focusing on the Kenyan market, is potentially withdrawing from the Ugandan and Rwandan markets.
Through this agreement, the Sarrai Group, renowned for its Rai Cement plant in Kisumu, extends its footprint in East Africa. The group's diverse interests, spanning from the Rai Cement plant to the contentious Mumias Sugar Company (MSC), contribute to its prominence across various industries.
With both Sarbjit Rai and his elder brother, Jaswant Rai, making headlines, the Rai family continues to exert significant influence in the Kenyan industrial landscape.
Family relationships have, at times, become entangled in court disputes and corporate conflicts, as exemplified by the 2019 MSC lease bidding scandal.
Through this agreement, the Sarrai Group secures control over several noteworthy assets, including Hima Cement in Rwanda, a clinker and cement factory in Kasese, Uganda, and a grinding mill in Tororo. Additionally, the group acquires ownership of a blending station in Namanve.