National Cement, a subsidiary of Devki Group, plans to acquire all the Kenyan assets of the debt-laden ARM Cement Company in a transaction valued at KSh5 billion.
ARM Cement, which operates in Kenya, Tanzania, and Rwanda was put under administrators in August 2018 after it failed to meet its debt obligations. In October of the same year, the firm’s creditors approved a proposal to identify a strategic investor for the company.
ARM’s joint administrators, Muniu Thoithi and George Weru, received several offers from interested investors drawn from diverse geographic locations. The two executives picked National Cement as the strategic investor based on their goal to achieve the best outcome for ARM’s creditors.
National Cement deals in the production and distribution of cement in Kenya. The firm was established in 2010 as part of the Devki group, owned by the renowned Kenyan billionaire, Narendra Raval. Since its incorporation, the company has recorded remarkable growth and is ranked as a leading cement producer in Kenya. National Cement sells its products under the brand name “Simba Cement.”
Speaking about the transaction, ARM’s administrator George Weru said, “We are pleased to announce the signing of this transaction which marks an important moment for the delivery of our mandate as Joint Administrators of ARM Cement to realize value for the creditors, ensure continuity for the business and its suppliers, and in the process safeguard jobs through a going concern sale.”
Muniu Thoithi, another administrator of ARM Cement, noted that the agreement between ARM and National Cement is a crucial milestone in the administration process.
The owner and chairman of National cement said, “This transaction is in line with National Cement’s growth strategy in Kenya to position itself as the leading cement manufacturer in the region. The industry is poised for growth, and we are excited about the prospects for the next chapter of our business.”
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