The BUA Group, one of Africa’s largest conglomerates, on Wednesday, announced the consolidation of its cement business comprising the publicly listed two million MTPA Cement Company of Northern Nigeria Plc (CCNN) and six million tonnes per annum (MTPA) Obu Cement Company Plc.
The company explained, in a statement, that the move was part of its bid to deepen the Nigerian capital market and enhance the growth of the cement industry,
It also revealed that it has notified the regulators.
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Furthermore, BUA announced that its newest three million metric tonnes cement plant which it started constructing in 2018 – the $450 million dollars Sokoto Kalambaina II plant -was scheduled for completion in the second half of next year.
With the consolidation and addition of the Sokoto Kalambaina II plant, this will bring BUA Cement’s total installed capacity across all its cement holdings to 11 MTPA,
Commenting on the development, the Founder & Executive Chairman of BUA Group, Abdul Samad Rabiu, said this consolidation would mark the culmination of the first phase of the BUA mid-term strategic plan for its cement businesses, which currently include four cement plants spread across Obu Cement Company and the Cement Company of Northern Nigeria.
A new $450 million Sokoto Kalambaina II Plant is scheduled to come on stream in the second half of 2020 alongside another 48MW power plant to complement the existing assets and take advantage of a growing cement market in Northern Nigeria and the West African region,” Rabiu added.
“This consolidation will cement BUA’s position as the second largest cement producer in Nigeria whilst also positioning it to take advantage of the combined synergies to effectively serve Northern and Southern Nigeria based on the strategic locations of these plants – as well as a sizeable export market.
We intend to continue creating value for the benefit of shareholders of the consolidated company by maintaining our focus on outperforming the Nigerian cement industry across key indices through a laser-like commitment to excellent products and service delivery, operational efficiency as well as maintaining our leadership position in our home markets,” Rabiu said.
Analysts predicted that the move would put BUA Cement in a stronger position to compete even better and explore export opportunities in neighboring countries.