Dangote to expand cement empire, bids for South African cement company

Media on Thursday reported that Dangote Cement has approached South African cement producer, (PPC), for takeover bid, though talks are still at preliminary stages.

PPC is already considering a bid by local rival, AfriSam, which launched a new all-share bid that values PPC at about 9.2 billion rand

Dangote Cement bid for PPC is a way to increase its visibility in the South Africa and surrounding SADC market.

Through Sephaku Cement, PPC offers the prospect of a much larger business than DangCems current operation in South Africa, NAN reports.

Annual Financial Statement for the full Year ended March 31, 2017 shows that Sephaku Cement had revenues of R2.28 billion (178 million dollars) in 2016 (see Fig 1).

This compares to PPC which had revenues of R9.6 billion ($748 million) in 2016, about four times that of Sephaku.

Obviously DangCem would love to own the bigger company and has signaled it would be open to a sale of all or part of its cement operations in Sephaku Cement to win regulatory approval for a takeover.

Posted by Juliet Ekwebelam