BY MICHAEL EBOH

Africa Finance Corporation, AFC, has invested N8 billion (US$50 million) in Athi River Mining, ARM, to support ARM’s expansion in Eastern and Southern Africa.

According to a statement by the AFC, headquartered in Nigeria, the investment will drive ARM’s expansion programme in Kenya and Tanzania as well as grow the business across the regions.

Mr Andrew Alli, President and Chief Executive Officer AFC, said its investment highlights ARM’s significant growth in earnings and capacity over the last five years as well as its future growth potential.

He disclosed that ARM, which is a mineral extraction and processing company, is now the second largest cement operator in Kenya, having interests also in sodium silicate, lime, industrial minerals, fertilizer and special building products in East and Southern Africa.

ARM, according to him, has subsidiaries operating in Kenya, Tanzania and South Africa and Rwanda and is also listed on the Nairobi Securities Exchange.

Alli noted that ARM currently produces approximately one million tonnes per annum of cement in Kenya and is constructing an integrated plant to further add 1.5 million tonnes per annum cement capacity in Tanzania.

He disclosed that the transaction, which is subject to the approval of the Kenyan capital markets authority, marks AFC’s first bilateral investment in Kenya.

He said, “We are delighted to be partnering with ARM to expand its business across the East African region.  The Company is a homegrown champion in the region’s cement sector and we are impressed with what the team, led by the Managing Director, Mr Pradeep Paunrana, has accomplished in the last few years.

“AFC is very excited by the growth opportunities in East Africa, and we look forward to expanding our portfolio of investments in Kenya and the region.”

Also speaking, Mr. Rick Ashley, Chairman, ARM, said, “We are so pleased to welcome AFC to Kenya and to ARM. We believe this investment together with the cash flows from the Kenya and Tanzania businesses will enable the Group to secure its place in the East African and regional markets over the next five years.

“It will enable us continue delivering the strong growth associated with ARM in future years.  Further we believe the terms clearly demonstrate the value creation that our expansion policy has been designed to deliver.”

In his own view, Mr. Pradeep Paunrana, Chief Executive Officer, ARM, said, “We welcome the investment by AFC and the entire management at ARM is now looking forward to another five years of growth and regional expansion.

“ARM has established a track record of building world class cement and clinker plants and earning a superior return for our investors.   As we go forward, our mission is not just to manufacture and distribute cement efficiently, but also to enrich the communities around us.

“ARM as a business will always have a significant input on the development of Africa and its people. Our relationship with AFC will enable us to contribute even more to our mission.”

Athi River Mining, headquartered in Nairobi, Kenya, is a rapidly expanding regional cement and industrial minerals company, listed on the Nairobi Securities Exchange.  ARM was founded in 1974 by H J Paunrana.  The Company has operations in Kenya, Tanzania, Rwanda and South Africa.

AFC is a Development Finance Institution established in 2007 as an African-owned and private sector led financial institution.  AFC seeks to improve African economies by proactively creating, acquiring, financing and managing infrastructure, industrial and financial assets. AFC is as an investor, developer and financier of infrastructure projects and infrastructure related firms across the Continent.