Steel magnate Narendra Raval, through his Devki group, officially took over cash-strapped Athi River Mining Cement (ARM) after a gruelling legal battle.
The acquisition will propel Mr Raval to be a top cement producer in the region when the production capacities of National Cement, owned by his Devki Group, and ARM are combined.
The transfer was dramatic to the last minute, with Raval fighting pesky security guards who briefly denied him entry into the ARM premises in Athi River.
“We are just following laws and regulations. In the morning we had not received the orders to let him in, but now we have,” said one of the guards after he kept the new owner waiting for more than 10 minutes.
Raval paid Sh5 billion for ARM, which is still under receivership. Following the conclusion of the transaction, he will become the largest cement manufacturer in Kenya with the combined production capacity of National Cement and ARM reaching three million tonnes per year.
Raval promised to retain all the 1,100 workers and also said the salaries of ARM’s employees would be harmonized with those of their colleagues at National Cement.
PwC said a Chinese firm has started the process of acquiring ARM’s Tanzanian unit, which was not part of the acquisition of the Kenyan operation.
Pradeep Paunrana, the former chief executive of ARM, had for a while been fighting a losing battle against the acquisition. The company was placed under administration on August 17, 2018, and its shares suspended from trading on the Nairobi Securities Exchange three days later.
The Competition Authority of Kenya (CAK) on October 4, 2019, gave National Cement the nod to take over the operations of ARM.