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Cimerwa to be de-listed in the Rwandan bourse

Cimerwa, Rwanda’s leading cement maker, will be delisted from the Rwanda Stock Exchange (RSE) to allow the new investor, Kenya-based National Cement Company, which bought the firm, to reorganise it and boost both the cement and clinker capacities to meet the growing demand in Rwanda and DR Congo export markets.

Highlights of the business plan by the Devki Group, which group chairman Narendra Raval shared with The EastAfrican, show over $154 million will be pumped into the Rwandan economy to increase cement and clinker production by 2024.

For over 30 years, Cimerwa, which has enjoyed a dominant position in the market, could not meet the market demand, forcing the country to import more cement from the region and beyond, for the growing construction needs.\

“Cimerwa will be removed from the public domain after six months,” Mr Raval said, explaining that the delisting will allow him to increase the plant’s production capacity from an estimated 270,000 tonnes annually to one million tonnes annually.

The added capacity is enough to meet Rwanda’s current cement demand estimated at 600,000 tonnes annually but is expected to rise with new large infrastructure projects such as the new Bugesera International Airport and the refurbishment of the Amahoro Stadium.

After reorganisation, 40 percent of the shares will be floated, offering East Africans a chance to buy them.

Celestin Rwabukumba, chief executive officer of RSE, acknowledged that de-listing could affect liquidity, in a small way.

“We are waiting to see what next,” Rwabukumba told The EastAfrican. 

Devki Group disclosed that it will infuse between $45 million-$50 million into the Rwanda operations to increase the clinker and cement plant’s production capacity, a move that could wean the country off cement imports. The group also plans to pump in over $62 million to increase the cement production capacity to 1.8 million tonnes annually after two and half years.

Read: Rwanda cement maker Cimerwa doubles net profit to $3.9m

“We want Rwanda to become a cement import-free country before the end of 2024,” Mr Raval said.

Increasing the company’s capacity comes at a time when Cimerwa, which owns a limestone deposit at a hot spring in Bugarama, Rusizi district in southwest Rwanda, announced a healthy pipeline of major infrastructure projects. In addition, Cimerwa said it has also strengthened its route-to-market strategy to maintain market leadership in key markets.

National Cement is part of the Devki Group, boasting a diverse portfolio in cement, steel, roofing materials, fertiliser, and packaging materials. The Group operates an integrated cement plant, a clinker plant, and multiple grinding plants in Kenya. It operates a cement grinding plant in Eastern Uganda, in Tororo near the Kenya border.

With Rwanda’s acquisition, of its cement business arm, cement production capacity is expected to reach 10 million tonnes annually, cementing its lead position in East Africa.

Raval says his group is committed to a long-term strategic partnership with Cimerwa.

“We believe in the potential for this business and its people and are excited by the opportunity to support infrastructure development in the region in line with our strategic expansion ambitions.”