Increased spending on East African infrastructure is pushing up demand for cement, making the building material attractive to some investors seeking a piece of Africa, according to a report in Business Daily.
Cement and lime accounted for 82 percent of 2012 sales for Kenya-based ARM Cement, which posted a 28 percent rise in profits through June, the report said. Fertilizer and industrial minerals took the remaining share of sales.
The company, with offices in Tanzania, Rwanda and South Africa, is preparing to spin off and list its non-cement business on the Nairobi Stock Exchange within three years, the Business Daily report says.
The company built a new cement plant with an annual capacity of 750,000 metric tonnes in Dar es Salaam that accounted for 8.7 percent of ARM sales in 2012.
Also in 2012, ARM secured a $50-million loan from Africa Finance Corp. to increase production. If Africa Finance exercises the right to convert the debt to equity, it will own 13.6 percent of ARM.
Cement companies are increasingly a focus for investors seeking a slice of East Africa’s strong economic growth, according to the Business Daily report.