Tanzania’s Amsons makes Sh23bn Bamburi buyout offer

Tanzania-based conglomerate with diverse interests in energy, construction, food and transport has made a $180 million (Sh23.15 billion) bid to acquire the entire stake of Bamburi Cement in what will mark one of the largest takeover deals in the East African region.

Amsons Group, which is a family-run business with operations in Tanzania, Zambia, Malawi, Mozambique, Democratic Republic of Congo and Burundi said Wednesday it has signed a binding offer with Bamburi Cement. The deal could see Bamburi, one of Kenya’s iconic blue-chip companies, delisted from the Nairobi Securities Exchange.

Amsons Group Managing Director Edha Nahdi said the proposed deal will deepen the group’s position in the cement sector in East Africa as part of the regional economic development and market integration ideals.

“We have great plans to deepen our investment in Kenya and in Bamburi,” said Mr Nahdi on the impending deal.

“Our offer to acquire shares in Bamburi is part of our corporate market expansion plan and will mark the formal entry of Amsons Group into the Kenyan market, where we plan to make investments in other industries in the coming months.”

The group issued the notice of intention to launch the public take-over offer through its Kenyan subsidiary and investment vehicle, Amsons Industries (K) Ltd, in a deal that will see Bamburi shareholders paid Sh65 per share.

At Sh65 per share, Amsons’ cash offer represents a premium of Sh20 per share or 44.4 percent gain, given that Bamburi share closed Wednesday trade at the NSE at Sh45 a share.

Bamburi is majority owned by Holcim through two investment vehicles—Fincem Holding Limited and Kencem Holding Limited—with a combined stake of 58.3 percent.

“This agreement to sell our stake in Bamburi Cement advances Holcim’s strategy of extending our leadership in our core markets as the global leader in innovative and sustainable building solutions,” said Martin Kriegner, regional head of Asia, Middle East & Africa at Holcim.

Amsons Group was founded in 2006 in Tanzania and now has more than $1 billion (Sh128.5 billion) in annual turnover. Its main business operations historically involved bulk oil and petroleum products importation under the Camel Oil Tanzania retail brand.

The group has, over time, grown its portfolio in the manufacturing sector with a 6,000 metric tonnes per day cement manufacturing capability, including through the recently acquired Mbeya Cement facility.