Lafarge increases stake in AshakaCem to 58.6 per cent
Category: Investors NewsBeat
June 23, 2011 by MOSES EBOSELE
The excerpt below provides more insight into the unfamiliar volume growth recorded by Ashaka Cement Plc which we analysed recently in our published report titled “Ashaka Cement Plc records astronomical volume growth”. The news story from The Guardian provides a narrative that should encourage investors to act.
LAFARGE Cement WAPCO Nigeria Plc has increased its shareholding in AshakaCem from 50.16 per cent to approximately 58.6 per cent.
Lafarge Nigeria Country Manager, Jean-Christophe Barbant, explained yesterday that the move confirms the company’s belief in the potential of AshakaCem and reinforces its commitment to the economic development of Nigeria, adding that Lafarge is in Nigeria for the long term.
He said: “Lafarge will continue to invest more time and expertise in further supporting AshakaCem’s leadership in the North of Nigeria.
“For example, enhancing service for customers, increasing production volumes to meet the growing demand for cement, delivering additional value for shareholders and further developing the skills of our employees,” said Barbant
Explaining further, the company said the acquisition was made with the consent of the Nigerian Stock Exchange (NSE) and “notified to the Securities and Exchange Commission (SEC) in line with Rule 111 of the Investment Securities Act.”
At the end of its 2010 yearly general meeting in Lagos recently, shareholders of the company commended the board and management of the company for setting aside N750 million for dividend, translating to 20 kobo per share despite the huge resources deployed to complete the ‘Lakatabu’ expansion project.
The new project, according to the company, is designed to increase its cement production capacity by approximately 2.2 million tonnes of cement yearly.
Located at Ewekoro, Ogun State, the plant is also equipped with a capacity of 1.65 million tonnes yearly of clinker and dry process technology for cement production.
Making reference to the company’s expansion project, the Chairman of the company, Chief Olusegun Osunkeye, in his response said the 2.2 million tonnes Lakatabu capacity expansion project at Ewekoro will be due for commissioning in the next few weeks.
He also used the opportunity to assure shareholders of a sustainable growth and continuous sustainability of the company, adding that “The company’s commitment to innovation and customer care; ongoing Lakatabu capacity expansion project; several performance improvement activities; commitments to the value of health and safety and Corporate Governance, will continue to make the company an investor’s choice.”
The company has also assured shareholders of the company that the ongoing expansion of depots and transport network is capable of enhancing return on their investment.
The Managing Director and Chief Executive Officer of Lafarge WAPCO Nigeria Plc, Mr Samy Abdelkader said the company remains focused on initiatives aimed at maintaining profitability.
Specifically, Abdelkadar explained that in anticipation of potential challenges in the haulage of products, the company has flagged off its logistic project geared towards enhancing the delivery of products with the commissioning of 70 new trucks.
Explaining further, he said the company expected to have over one thousand state-of-the art trucks at the end of the project.
He added that the company is also collaborating with the Nigeria Railway Corporation (NRC) on the haulage of its products, adding that the initiatives is expected to bring the products closer to all customers nationwide.
“In addition to this, we have equally optimise our depot strategy with the opening of new depot across the nation (from seven to 19 depot nationwide). Apart from this, we have an e-collection services which will aid easier business transaction by our customers”, said Abdelkadar.
Commenting on the Lakatabu project, recently, the Exective Secretary, Cement Manufacturers Association of Nigeria, Mr. James Salako, said: “The main lesson from this is that Nigerian local manufacturers of cement have enough capacity to meet local demand. This year, we expect all the new facilities currently under construction to come on stream. Part of these is Lakatabu by Lafarge WAPCO.
“All things being equal, we expect to start 2012 with a total installed capacity of 28 million metric tonnes per annum. We do not expect anything less than 60 per cent performance from most of the new plants in 2012.”
He added: “The ultimate is not just to become self-sufficient in cement production, but to become a net exporter of the product. The Federal Government has given 2013 for the achievement of the self-sufficiency in cement production, but we can see clearly from the above facts that becoming a net exporter of the product is attainable even before 2013."