ARM negotiating US$120m loan deal with IFC

ARM Cement Ltd of Kenya is trying to reach an agreement with the International Finance Corp about a capital injection of US$120m in loans, acccording to ARM's Chief Executive Officer, Pradeep Paunrana.

"Nobody just gives you US$120m without conditions," Mr Paunrana said. "We are in discussions, it is not a facility, it is a term sheet. There are conditions attached to this."

The main conditions include a return to profitability and getting an equity investor during the next nine to 12 months, he added. ARM's focus is on getting its Tanzanian plant fully operational, generating positive cashflow, as the company seeks to reduce the debt and refinance the balance.

He further suggested that ARM will convert KES21.6bn (US$214.2m), owed by its Tanzanian unit, Maweni Limestone Ltd, into equity. ARM’s clinker plant in Tanga is operating at near full capacity and could supply its Kenya business with clinker.