Huaxin Cement has bought the Tanzanian unit of Athi River Cement (ARM) Cement, Maweni Limestone Limited, to complete one production plant. A joint statement from PwC and Huaxin reveals that the company will clear the unit’s debt worth $116 million and invest $30 million to complete and upgrade the plant. An administrator at PwC reveals that the unit needed a capital investor given its financial circumstances.
“Securing a suitable investor with the ability to make the requisite investments and inject much-needed capital to boost Maweni’s operations was a top priority given Maweni’s dire financial situation,” Reuters quotes Muniu Thoiti, a PwC administrator.
SEE ALSO: National Cement Completes Acquisition of ARM Cement Assets
Part of ARM’s downfall was a substantial investment in Tanzania, which did not yield return. ARM had installed two plants with an annual production capacity of 1.6 million tonnes in the country. This was besides installing two plans with a yearly production capacity of 1 million tonnes in Kenya and another with 100,000 tonnes annually.
In 2018, the Nairobi Securities Exchange suspended the trading of ARM’s shares. The company was put under administration by its creditor over a KSh 7.9 billion debt.
Last year, National Cement acquired ARM Kenya for KSh 5 billion.
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