Kenya: CDC Group appoints two directors to ARM's board of directors

UK’s sovereign wealth fund CDC Group has appointed two directors to the board of Kenyan cement manufacturer ARM Cement Ltd in which it recently acquired a 40.6 per cent stake for KES14.1bn (US$139.4m).

The fund appointed Pepe Meijer and Ketso Gordhan to the board of the Nairobi Securities Exchange-listed company. Investment banker John Ngumi was also simultaneously appointed as an independent director of the firm.

The new directors will help drive the company’s strategy at a time when it is in the middle of a regional expansion plan. Mr Meijer is a CDC adviser and has worked in the gold mining industry, among other sectors. Mr Gordhan is the head of CDC’s Africa operations. He previously spent several years as chief executive of PPC Cement, South Africa’s largest cement company. Mr Ngumi is expected to bring his investment banking expertise to ARM, having advised and structured several fundraising deals for the company in the past few years.

The three new appointments coincided with the exit of three board members – finance director Atul Mathur and non-executive directors Daniel Ndonye and Michael Turner. Mr Mathur’s replacement is expected to be selected in the coming days.

The cement manufacturer is expected to retire or restructure its multi-billion-shilling loans that pulled it into a loss position, prompting it to seek the new funding from CDC.

Besides reducing the company’s debt burden, the cash from CDC will also be used to fuel ARM’s expansion plans in the region. CDC, which said it has invested in ARM for the long term, noted that one of the company’s priority projects is the planned cement plant in Kitui.