ARM Cement receives US$15m cash boost from shareholders

ARM Cement will receive an additional US$15m cash injection from its key shareholders to help shore up its financial position as it searches for a strategic investor.

Managing Director, Pradeep Paunrama, said part of the new money is aimed at helping ease the cement maker's tight cash position and will mainly be channelled to its Tanzanian unit as capital expenditure.

"We are looking at injecting 15 million dollars. That's for the overall company but most of it is needed in Tanzania to get the unit running back on its feet," he said in an interview Monday.

"Now that Tanzania has started making profit again we need to rebuild Tanzania, fund the working capital... that is where the money is required."

UK sovereign wealth fund, CDC Group, bought a 42 per cent stake last year in the cement maker that saw it inject KES14bn (US$135.5m). Mr Paunrana said the firm is looking to further strengthen its management team ahead of the entry of the strategic investor.

The firm had earlier attributed its wider loss in the half-year ended June to its Tanzanian operations.
The cement maker is capitalising on Tanzania's rising demand for clinker to supply local cement manufacturers from its Tanga plant following a state ban on the importation of clinker.