Nairobi Securities Exchange (NSE) has announced that Sarrai Group owned by billionaire Sarbjit Singh Rai together with Rwimi Holdings will buy Bamburi Cement's stake in Uganda and Rwanda operations in a deal estimated to be worth Ksh18 billion.
According to a cautionary statement released by NSE on Tuesday, the two companies have entered into an agreement to buy 1,335,600 ordinary shares in Hima Cement Limited based in Uganda with operations in Rwanda.
Under the deal, the two companies will buyout Bamburi Cement which had a 70 per cent controlling stake.
“Sarrai Group Limited and Rwimi Holdings Limited will acquire 100 per cent of the issued share capital of Hima Cement Limited from Himcem Holdings Limited and Cementia Holding AG at a value of $120 million (ksh18 billion subject to certain adjustments to be made at or after completion,” the NSE statement read in part.
The deal is subject to approval by the Capital Markets Authority (CMA) and other regulatory bodies. NSE also noted in the statement that shareholders of the listed cement manufacturer will have to approve the deal.
“Upon completion of the Proposed Transaction, Hima Cement Limited (and all its subsidiaries, including Hima Cement Rwanda Limited) will cease to be a member of the Bamburi group and will become a member of the Sarrai group,” NSE noted.
This means that the troubled cement maker will be exiting the Ugandan and Rwandan markets as it focuses on Kenyan operations.
Sarrai Group operates the Rai Cement factory in Kisumu and has some other holdings in Kenya, including the contested Mumias Sugar Company (MSC).
MSC receiver manager in 2019 awarded the Uganda-based firm a 20-year lease of the ailing miller, but other competitors rushed to court, halting the process. He had placed a bid of Ksh11.5 billion, triggering a bitter rivalry with his elder brother who placed a Ksh3.5 billion bid.
Sarbjit Rai is the younger brother of Jaswant Rai who has been in the news over his dominance of Kenya's sugar sector. The two have fallen out over the late father's estate.
Under the deal, Sarrai Group will take control of a grinding plant in Tororo and a blending station in Namanve, all in Uganda.
They will also own a clinker and cement plant in Kasese, Uganda as well as the Hima Cement in Rwanda.
