High-Stakes Showdown for Bamburi Cement: Shareholders Brace for Crucial Vote
The fight for Bamburi Cement has emerged as one of the electoral races with key shareholders set to vote for control by December 5. At the moment, there are two strong suits which actively compete in an attempt to influence the destiny of this cement industry behemoth.
The Bidders: Amsons Group: stock split results of the recent savanna Clinker Limited.
Savanna Clinker’s Patriotism Driven Offer
Through its chairman Kenyan tycoon Benson Sande Ndeta, Savanna Clinker has upped its offer from Ksh70 to Ksh76.55 per share reaching as far as Ksh27.8 billion. By so doing, Ndeta puts himself on the side of a patriot, who should support Kenyan businesses and with Faida Investment Bank by his side.
“To reassure those who will accept our offer, we assure all the shareholders that all the money will be paid in full, as we have adequate capital resources,” said the Managing Director of the Faida Investment Bank Lucas Otieno. The expansion bid for Savanna is further enhanced by its recognition due to its financing from the Global Infrastructure Finance and Development Authority (GIFDA).
Amsons Group’s Pan-African Strength
Kenyan quarry and construction materials firm Bamburi Quarry has received a Sh23.59 billion ($250 million) bid from Tanzanian conglomerate Amsons Group, led by its chief executive officer Edha Nahdi through its subsidiary Amsons Industries (K) Ltd. Amsons is conducting its bid in association with Kenya Commercial Bank (KCB) and has pledged to invest $350 million to upgrade Bamburi’s grinding and clinker manufacturing facilities
Reducing its bid price, Amsons seems not to be worried at all. But that was not all: “Our offer is at 42% above today’s price of Bamburi” remarked a leading member, Ahmed Abdallah.
Calendar of Key Decisions and Decision Flows
December 5, 2024: The shareholders are entitled to exercise their votes on the two bids.
December 20, 2024: That is when Bamburi will announce the winning bid.
February 28, 2025: Dividends to shareholders being paid subject to conditions set by relevant authorities.
In line with CMA regulations, bidders are free to update the offer within the next 10 days before the due date thus keeping the investors in suspense.
The Race for Holcim’s Stake
Bamburi’s major shareholder, Holcim, holds a critical 58.6% stake through two entities: Fincem Holding Ltd and Kencem Holding Ltd. Though Holcim had initially agreed to sell to Amsons, Holcim again changed its mind in October and offer Savanna Clinker a new window to try to attain control.
Savanna Clinker’s Edge
Savanna Clinker is pinning a lot of its success on its home country of Kenya. Ndeta, who has more than 20 years’ experience in the cement industry, was formerly chairman of East African Portland Cement and drove a KES 65 billion clinker project in Kitui to cut importation.
Savanna’s history has painted it with some bad pasts like its former company’s difficulties in commanding adequate funds, but Ndeta wants Bamburi to remain in the NSE.
Amsons’ Pan-African Vision
Amsons Group is currently active in many countries like Tanzania, Malawi, Mozambique, DRC, Zambia and Burundi. Its cement production plant has a daily production of 6,000 tonnes and the firm’s revenue is Ksh130 billion per year.
If Bamburi is to be merged with Amsons, the later has, in its takeover bid proposal, expressed willingness to have the entity delisted from the NSE if it were to get 75% controlling stakes which probably will not be acceptable by all the shareholders.
The Stakes for Shareholders
Both bidders bring compelling offers:
Savanna Clinker: A higher price with a message of patriotism and a promise never to exit the NSE.
Amsons Group: A seasoned and well diversified candidate with regional focus and with plans to modernize.
CMA has invited shareholders to consider which proposal best suits them.
What’s Next?
That leads to a raising of stakes as the December 5 voting deadline approaches. In this case, shareholders are presented with tough decision that is likely to change the Organization: Bamburi’s history.