The IFC is providing up to US$70m to Kenya's National Cement Company Ltd (KNCC) to expand the cement producer's operations, increase the local cement supply and promote infrastructure development in Africa.
IFC will provide up to US$55m in debt. In addition, IFC and the IFC African, Latin American and Caribbean Fund will inject US$15m equity into National Cement and will have a seat on the company’s board, said the IFC in a statement. The project marks IFC’s largest investment in building materials globally in the recent past.
IFC’s investment will enable KNCC to quintuple its production capacity to 1.7Mta as well as expand its plant in Nairobi, creating over 6000 jobs. There will be further benefits to small businesses that transport the cement producer's raw materials and provide general services.
National Cement is part of the Devki conglomerate, which also has steel and services industries in Kenya.
Narendra Raval, chairman of the Devki Group, said, “By partnering with IFC, National Cement looks forward to combining our long-standing experience in Kenya’s building materials sector with IFC’s international expertise in infrastructure and environment management. As National Cement expands, we aim to contribute actively to improving infrastructure and housing in Kenya.”
Cement consumption in Kenya has grown at a rate of 13 per cent per year in the last six years, as the country’s economy grows. National Cement is one of Kenya’s few domestic cement manufacturers.
Oumar Seydi, IFC director for eastern and southern Africa said, “Kenya often imports cement at high costs. This investment in National Cement will increase the supply of locally produced cement, providing building blocks for East Africa’s infrastructure needs. We would like to send a strong signal of IFC’s confidence in a Kenyan company making a difference in the local economy.”
