..Consolidates Market Share With CCNN Merger
Yemisi Izuora
In its bid to deepen the Nigerian capital market and enhance the growth of the cement industry, BUA Group, one of Africa’s largest conglomerates, has announced the consolidation of its cement business comprising the publicly listed 2million metric tons per annum, Mtpa Cement Company of Northern Nigeria Plc (CCNN) and 6million mtpa Obu Cement Company Plc.
This disclosure was made in a filing to regulators.
BUA also announced that its newest 3million metric tonnes cement plant which it started constructing in 2018 – the $450million dollars Sokoto Kalambaina II plant, is scheduled for completion in H2, 2020. 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 million MTPA.
Commenting, Abdul Samad Rabiu, Founder & Executive Chairman of BUA Group, said that this consolidation marks 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 $450million 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 laserlike commitment to excellent products and service delivery, operational efficiency as well as maintaining our leadership positon in our home markets,” Rabiu said.
Analysts predict that this will put BUA Cement in a stronger position to compete even better and explore export opportunities in neighboring countries.