Bamburi Cement has signed a US$250 million (Ksh32 billion) Engineering, Procurement and Construction (EPC) contract with China-based Sinoma CBMI Construction Co., Ltd for the construction of a new clinkerisation factory in Matuga, Kwale County.
In a statement on Tuesday, December 16, the company said the project is part of Bamburi Cement’s strategy to expand its manufacturing operations, reduce reliance on imports, and support Kenya’s infrastructure development and economic transformation.
The clinkerisation plant will have a production capacity of 1.6 million tonnes per year and will incorporate advanced, carbon-neutral technologies aimed at reducing environmental impact.
Through the project, Bamburi Cement plans to more than double its clinker production from 1 million tonnes to 2.6 million tonnes, while cement production is expected to increase from 1.8 million tonnes to 4 million tonnes annually.
President William Ruto, who witnessed the signing of the agreement, said the government will support the Bamburi Cement project and other similar investments that promote value addition, job creation, and industrial growth.
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"The Government of Kenya remains fully committed to supporting this project and similar investments that deepen value addition, create jobs, and strengthen our manufacturing base," he said.
Ruto stated that the cement industry plays a central role in Kenya’s economic development, noting that major infrastructure projects depend on a stable and competitive cement supply chain.
"The cement industry sits at the heart of our economic freedom agenda. Every road, power plant, dam, irrigation canal and factory depends on a reliable, competitive and sustainable cement value chain.
"Projects such as the Bamburi Clinker Line are not isolated investments, they are foundational catalysts for our national transformation," he added.
Ruto also highlighted the need for Kenya to reduce cement imports by utilizing its abundant local raw materials.
"It is not possible for us to continue importing cement, Kenya has an abundance of limestone and other raw materials for cement production," he further said.
The deal comes a year after Savannah Clinker Limited withdrew its offer to acquire Bamburi Cement.
In a statement on Wednesday, December 4, 2024, Capital Markets Authority (CMA) said it had approved the withdrawal of the offer, and gave Bamburi Cement shareholders, who had accepted the offer until Thursday to reconsider their decision.
"CMA would like to notify the shareholders of Bamburi Cement Plc and the investing public that Savannah Clinker Limited has withdrawn its competing offer for the acquisition of the Bamburi Cement Plc shares today. CMA has also approved the withdrawal of the offer in line with the Capital Markets (Takeover and Mergers) Regulations, 2002.
"Following this development, shareholders of Bamburi Cement Plc who had accepted the offer by Savannah Clinker Limited have until 5.00pm on Thursday, 5 December 2024 to reconsider their decision. Shareholders who do not change their decision will be deemed to have declined the offer by Amsons Industries (K) Limited and remain shareholders of Bamburi Cement Plc," the statement read in part.
CMA further noted the only valid offer is the one from Amsons Industries (K) Limited which has already been approved by the Authority.
"Shareholders who had accepted either of the offers are free to withdraw their acceptance before the closure of the offer period at 5.00 pm on Thursday, 5 December 2024. Trading of Bamburi Cement Plc shares will be suspended from 9.00 am on 06 December 2024 to facilitate reconciliation," the statement concluded.
Savannah Clinker Limited's move to withdraw its offer came days after its Chairman, Benson Sande Ndeta, was arrested and subsequently arraigned in court.
Ndeta was arrested on charges of defrauding Absa Bank of $35 million, allegedly acting on behalf of Savannah Cement Limited.
He faced eight counts, including conspiracy to commit a felony and obtaining credit by false pretenses, which he denied.
After spending the weekend in custody, the High Court ordered his unconditional release, halting further prosecution pending a hearing set for January 30, 2025.
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