•The deal comes at a time that Bamburi Cement posted a drop in net profits to Sh88 million for the first half of 2023.
•According to the cement maker the drop in profits were attributed to tax settlement in Uganda that affected the net profits.
Bamburi Cement is selling off its stake in Ugandan subsidiary for $120 million (Sh18.3 billion) to focus on its Kenyan operations.
Hima Cement Limited is the subsidiary and has been operating under Holcim Group in Uganda.
Bamburi Cement PLC owns Seventy percent of Hima Cement Limited with the remaining 30 percent owned by Cementia Holding AG (a member of the Holcim Group).
Holcim has agreed to sell its Ugandan business, operated by Hima Cement Ltd, its local subsidiary in Uganda, to the Sarrai Group, for an enterprise value of USD 120 million (Sh18.3billion).
According to a communication by Bamburi Cement Plc. its board has approved the sale of the stake in Hima Cement Limited.
Completion of the transaction is subject to obtaining the relevant regulatory clearances and the approval of the shareholders of Bamburi Cement PLC.
“Holcim and its affiliates are pleased to have found a strategic and trusted partner for the Ugandan business in Sarrai, which is well positioned to continue investing in its long-term growth. Holcim and Bamburi Cement PLC see it as a positive opportunity for all parties and believe that this deal will ensure a prosperous and profitable future for Hima Cement Limited,” Bamburi Cement said in a statement.
The cement maker was however quick to note that the transaction does not impact operations for Bamburi Cement PLC in Kenya.
The deal comes at a time that Bamburi Cement posted a drop in net profit to Sh88 million for the first half of 2023.
This is a Sh7 million drop from the Sh95 million that the firm recorded in the same period in 2022.
According to the cement maker the drop in profits have been attributed to tax settlement in Uganda that affected the net profits.
The cement manufacturer had increased its pre-tax profits to Sh621 million, in the period from Sh124 million in 2022.
However, a Sh533 million tax weighed down the gains leading to the drop in profitability.