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Tanzanian tycoon Edhah Abdallah Munif’s bid to expand his cement empire across East Africa has been halted after Kenyan lawmakers rejected his plan to buy a major stake in East African Portland Cement at a cut-rate price.
Members of Parliament this week opposed Munif’s attempt to acquire Holcim’s 29.2 percent holding in the Kenyan cement maker through his investment firm, Kalahari Cement. The proposed sale price was KSh 27.30 (USD 0.21) per share—less than half the market trading price of KSh 58.50 (USD 0.45) on the Nairobi Securities Exchange.
Legislators on the National Assembly’s Trade, Industry and Cooperatives Committee argued the discounted sale would hand control of a strategic asset to a foreign buyer. They pressed Portland Cement’s leadership to consider a share buyback or seek other investors to safeguard Kenyan shareholder value.
“Why sell our company for a song when the market clearly values it higher?” asked MP Samuel Parashina of Kajiado South.
Portland Cement Managing Director Mohammed Osman told lawmakers the company could afford a buyback if it obtained approval from the Capital Markets Authority. He said Holcim, which is withdrawing from Sub-Saharan Africa, is eager to offload its stake.
Had the deal proceeded, Munif’s overall interest in Portland Cement would have climbed to 41.75 percent, cementing his status as the single largest shareholder through his Amsons Group holdings.
The dispute comes amid soaring performance for Portland Cement’s stock—up 385 percent in the past year and 55 percent over six months—even though the company’s market value still trails its net asset worth of about KSh 20.4 billion (USD 158 million). The figure is backed by land holdings exceeding KSh 21 billion (USD 162.6 million).
Regulators including the Competition Authority of Kenya and the Capital Markets Authority have been asked to intervene. But the CMA said it lacks authority to dictate sale prices between private parties.
For Munif, one of Tanzania’s most prominent industrialists, the blocked acquisition puts a pause on his push to dominate Kenya’s cement market. Whether Holcim reopens talks or Portland Cement pursues a buyback will determine if his ambitions in Nairobi’s construction sector can resume.
