Friday, April 19, 2013

ITALIA: La crisi, paura a Scafa per la sorte del cementificio

La Italcementi chiude 9 stabilimenti su 17, ma non si sa ancora quali. Il sindaco: "Per ora non riteniamo che sia a rischio"

Ha vuto riflessi immediati a Scafa, la notizia diffusa ieri dalle agenzie di stampa, sulla nota con la quale il presidente della Italcementi Giampiero Pesenti e il consigliere delegato Carlo Pesenti hanno informato gli azionisiti della società che le cementiere del gruppo da 17 saranno ridotte a 8, in accordo con un piano annunciato verso la fine dell'anno scorso. La nota spiega nel dettaglio la sorte dei 17 stabilimenti a ciclo continuo: «Una è stata venduta e due sono state declassate a centri di macinatura. Delle 14 rimanenti, 6 rimangono come cementerie a ciclo completo, altre 3 vengono utilizzate come centri di macinazione e 5 rimangono in stand by in attesa delle richieste del mercato. Di queste 5 nel corso del 2013 Italcementi prevede di utilizzarne non più di 2, che sommate alle 6 assolutamente confermate danno la cifra finale di 8 cementerie sicuramente aperte».

Insomma, stante la crisi delmercato del cemento la holding bergamasca potrebbe soddisfare la domanda con meno della metà dei suoi stabilimenti, ma ieri nell’assemblea degli azionisti non è stato specificato quali sono destinati a chiudere . La domanda alla quale a Scafa ieri si è cercato di dare una risposta è se lo stabilimento cittadino sia compreso o meno fra gli otto che resteranno in attività Al momento nella cementiera di Scafa le lavorazioni sono ristrette alla trasformazione del clinker che arriva già preparato dallo stabilimento di Colleferro. 

Non c'è più, dal febbraio scorso, l'attività estrattiva del materiale primario esercitata nelle cave situate nel territorio di Lettomanoppello secondo una concessione mineraria secolare. Dal febbraio 2013 è partita anche la cassa integrazione straordinaria per i lavoratori di Scafa. Trentadue di loro, su settanta, sono a rotazione in tutti i settore produttivi dell'opificio, in modo da garantire il turno di lavoro per tutti. 

Fu un accordo, sottoscritto fra azienda e parti sociali con una validità di due anni. «Tutto dunque», secondo Massimo Di Giovanni della Cgil, «è rimandato alla fine del 2014. Le nostre informazioni dicono che nulla è cambiato dalle assicurazioni che l'azienda espose in sede negoziale lo scorso febbraio. Avremo in ogni caso modo di approfondire ogni risvolto della questione, il prossimo 23 aprile, data già stabilita per una assemblea generale nello stabilimento». 

Gli fa eco il sindaco Maurizio Giancola che ha sempre intrattenuto rapporti frequenti con l’azienda, «poiché», spiega , «per la nostra cittadina la presenza di questa fabbrica è questione di vita o di morte per la nostra economia e delle possibilità lavorative ed occupazionali, nonché per la programmazione amministrativa. Lo stabilimento è il cuore del paese, intorno al quale ruota ogni attività ed anche noi, alle prese con la possibilità di revisione degli strumenti urbanistici, dobbiamo indispensabilmente venire a conoscenza delle intenzioni aziendali. 

Per quanto mi è dato sapere oggi posso dire che non ci sono state modifiche alle assicurazioni tranquillizzanti che il direttore Mora fece lo scorso febbraio, affermando di voler rimanere in piena efficienza sulla piazza di Scafa e di garantire l'occupazione. Garanzie espresse nonostante che il mese di gennaio 2013 fu il peggiore nell'ultimo quadriennio per il mercato del cemento. Non ci sentiamo dunque per ora di ritenere a rischio il nostro stabilimento».

AFRICA: KENYA: New Kenya Cement Industry Study: Full Steam Ahead by 2017

Kenyan cement companies hit the brakes in 2012 when the industry reached the lowest growth rate in the last ten years. However, going forward the fortunes are expected to turn as cement demand is projected to expand 10 percent per year on average and exceed 6.3 million tons annually by 2017. Kenya’s cement consumption per capita is also forecast to reach an important milestone in 2014 when it will surpass, for the first time in its history, 100 kilos per inhabitant, according to the CW Group, the leading global cement industry consultancy and research house based out of New York, USA, as it detailed the state and outlook of the Kenyan market in its “2013 CW Group Kenya Market Update report.”

According to the CW Group, “Kenya took a turn for the better in March 2013. The turning factor was materially driven by a non-violent outcome of the presidential election process held on March 4, 2013. Given the peaceful conclusion of the election, stalled investments are expected to ramp up and reach their full implementation during the second half of the year and onwards. The government has set aside consistent funds for infrastructure, energy and social programs, while residential consumption is also expected to lift the low cement consumption per capita of the country.”

In 2005, the cement demand in Kenya was at a mere 1.6 million tons. Since then, the market registered impressive growth, closing 2012 at almost 4 million tons in cement consumption. But the industry is not without concerns: Kenya is still dependent on large clinker imports, with over 1.2 million tons imported in 2012 mostly from China. The dependency on clinker imports is expected to continue as efforts targeted toward capacity expansion are mostly focused on cement grinding.

Along with the entrance of the seventh cement company in the Kenyan cement market at the end of 2014, three other cement companies are expanding their cement capacities: EAPCC, National Cement and Mombasa Cement. Their combined efforts are estimated to place the national nameplate cement capacity over 11.1 million tons by the end of 2017. Capacity expansions across the East Africa region add additional competitive pressure as do perennial fuel sourcing issues for clinker producers in the country.

But fundamentally, Kenya benefits from a favorable combination of economic strengths and opportunities, which assists the country in meeting the ambitious objectives detailed in the Kenya Vision 2030 program. Moreover, Kenyan cement companies provide a stable environment for domestic consumers as the market continues to be self-sufficient.

The CW Group analysts note that “the availability of quality limestone reserves in Kenya provides its cement companies an important competitive advantage, as most of the regional markets are lacking sufficient raw materials. However, environmental concerns and the resistance of local residents continue slowing down the process. Access to clinker will remain a key differentiator for the coming five-year period when it comes to product pricing and margins.” The expected inception of coal mining in Kenya can also bring some relief for cement companies against inflating fuel costs.

The “2013 CW Group Kenya Market Update report” (published 04/2013, 41 pages) is available for $1,710 from the CW Group. For further detail contact sales@cwgrp.com or visit our website for a complete table of contents, including a competitive dynamics analysis enriched with a SWOT perspective, complemented by cement consumption and nameplate capacity projections up to 2017.

EEUU: US cement shipments increase in January 2013



According to the USGS Mineral Industry Survey for cement, shipments of Portland and blended cement in the US and Puerto Rico increased by 5% y/y to reach 4.8 million t in January 2013. The biggest cement consuming states were Texas, California, Florida, Arizona and Oklahoma, who together received around 46% of the month’s shipments. The top three producing states were Texas, California and Florida.

Clinker production grew to 4.3 million t, with Texas, Missouri, California, South Carolina and Florida accounting for 56% of the total clinker produced in January 2013.

Shipments of masonry cement were up 8% y/y to 141 000 t. The biggest consumers of the material were Florida, Texas, California, North Carolina and Georgia.

Cement and clinker imports are estimated at 464 000 t for the month, an increase of 25% y/y.

COLOMBIA: Con las exportaciones, la industria desafía debilidad

Pese a la revaluación, el sector ha logrado entrar a nuevos mercados.


En medio de la debilidad que hizo que su producción retrocediera 0,7 por ciento el año pasado, caída que continuó en el arranque del presente año, las exportaciones de la industria, sin productos del petróleo o del carbón, vienen creciendo.


De acuerdo con las cifras entregadas por el Dane, entre enero y febrero, las exportaciones del sector industrial, sin productos a partir de carbón y petróleo, crecieron 3,5 por ciento, con respecto al mismo lapso del 2012, justo cuando las exportaciones totales del país experimentaban una caída de 3,4 por ciento en esos dos meses.


Según el Dane, entre los cuatro grupos de exportaciones de bienes industrializados, uno cae, el de las ventas basadas en recursos naturales, en donde están los combustibles, con un retroceso de 12 por ciento.


Entre tanto, los productos de baja tecnología aumentan 1,2 por ciento ese bimestre, a 415 millones de dólares. Se trata, entre otros productos, de textiles, calzado y muebles.


Las exportaciones de manufacturas de tecnología media, como vehículos y plásticos, crecen 15,2 por ciento, a 836 millones de dólares.


Igualmente, en los dos primeros meses del año repuntaron las ventas al exterior de productos de alta tecnología, como máquinas para procesamiento de datos, turbinas y generadores eléctricos, al subir de 107 a 118 millones de dólares.


El presidente de la Asociación Nacional de Comercio Exterior (Analdex), Javier Díaz, afirma que las empresas vienen buscando hace un tiempo diversificar mercados, y un buen número de ellas lo ha logrado”.


Por ejemplo, observa que desde que rige el TLC con Estados Unidos –mayo de 2012– se envían a este país productos que antes no se exportaban.


Raúl Ávila Forero, de la Coalición para la Promoción de la Industria, dice que la principal razón se debe a que las empresas manufactureras han venido acumulando inventarios, y en el momento en que se abre la ventana para vender sus excedentes afuera lo logran con mayor facilidad.


El presidente de Cementos Argos, Jorge Mario Velásquez, afirma que en 2013 tienen como meta exportar dos millones de toneladas de cemento y clínker, con un crecimiento cercano a 7 por ciento respecto 2012. “Las exportaciones del primer trimestre estuvieron dentro de las expectativas; atendemos unos 35 destinos fuera, y aunque la cifra depende mucho de las demandas primarias, son unos 140 millones de dólares anuales”, expresa.

Thursday, April 18, 2013

Africa, Tanzania: Tight Cost Control Boosts Twiga Cement's Profitability



Tanzania: Tight Cost Control Boosts Twiga Cement's Profitability
Tanzania Portland Cement Company's (TPCC) positive financial results last year have been attributed to tight cost control within the inflation level.
TPCC Managing Director Pascal Lesoinne said in Dar es Salaam that the cost control helped to increase the firm's net profit by 22 per cent to 61.57bn/- despite the indiscriminate import exacerbated competition. "... the company managed to create additional value by increasing its turnover and keeping costs under control."
The operation of the company was also supported by the returning of stable power supply, the activity in construction sector that grew by eight per cent with a growth of cement market of 10 per cent to 2.7 million tonnes in the year.
"Focus on customer needs and satisfaction has also translated in tailor-made delivery solutions and enhanced customer technical support. We want to assist our customers in their business," Mr Lesoinne said.
The Core Securities Chief Executive Officer George Fumbuka said the Twiga results speak for themselves but are actually better than they appear at first, giving the level of competition that was very stiff, especially from within the East African region.
"... Notwithstanding the competition in dollar terms, Twiga has managed to keep its prices steady and as a result has increased market share," Mr Fumbuka said: To meet the market demand, the cement firm has rehabilitated its kiln three that will end dependency on clinker imports by producing its own 250,000 tonnes per annum.
The firm is also constructing an additional cement plant that has the capacity of producing 700,000 tonnes and expecting to go into production by mid next year. "The Board has approved further expansion project in a new cement mill. The new mill which is expected to be completed by mid-2014 will make TPCC the biggest cement producer in the sub- region," Twiga Chairman Jean-Marc Junon said.
On the Dar es Salaam Stock Exchange, the value of Twiga shares continued to rise and is now trading at 2,620/- after gaining by 1.53 per cent. "The secret is efficient operations, dedicated, hardworking and well-trained staff and stringent cost control," said Mr Fumbuka.

Africa, Nigeria: CCNN Empowers 400 Women


Sokoto: Cement Company Empowers 400 Women

The Cement Company of Northern Nigeria (CCNN) Sokoto State has embarked on skill acquisition training programme for 400 women in Wamakko Local Government Area of the state.

Speaking at the launch of the Skill Acquisition Programme in Wamakko council, Managing Director of the Company, Mr. Alf Karlsen, said CCNN embarked on empowering 400 women in the host communities in order to tackle poverty and improve the lots of the rural dwellers.
He explained that the women would be trained in 10 centres in Wamakko and Gumbi districts, adding that the programme would help to improve their livelihood.

According to him, a similar programme was embarked by CCNN three years ago for youths in the host communities, adding that so far 80 youths had been trained on various skills at Sokoto Works School, leading to the award of the nationally recognised Trade Test Certificate.
“As you are aware, the envisaged success of this programme made the company to extend same to the women in order to give them same opportunity for economic empowerment and growth,” he stressed.

Karlsen explained that the women would be trained on how to make soap, pomade, perfume, among others.

The CCNN boss pointed out that at the end of the programme, the women were expected to produce these items in commercial quantities within the comfort of their homes and earn an income.

He said to this end, the company would assist the women by providing them with the necessary materials and items to start on their own.

Karlsen stated that over N5 million had been earmarked for the programme. The Managing Director averred that CCNN was committed to its corporate social responsibility and would continue to work closely with communities in providing assistance to them in areas of education, health, infrastructure and economic empowerment.

He announced that the company would provide scholarship to students of host communities to study in universities and other tertiary institutions this year.
He added that other major projects earmarked for the area in 2013 include provision of boreholes in Kalambaina area and drugs to Wajeke clinic and Police Barrack Clinic.

He urged the women to make use of the training to improve the living conditions of their families.
In a remark, the Chairman of Wamakko Local Government Area, Alhaji Ahmad Kalambaina, thanked the company for the empowerment programme and urged other firms in the state to emulate CCNN.

AFRICA, Nigeria: Manufacturers Seek Code of Conduct Review On Cement


Nigeria: Manufacturers Seek Code of Conduct Review On Cement

The Cement Manufacturers Association of Nigeria has called for a review of the industry's code of standards to enable it the take into consideration the peculiarity of the local environment.

The CMAN Chairman, Mr. Joseph Makoju, made the call in Abuja at a forum on concrete specifications, application and cement standards. The forum, which had key stakeholders from the cement industry, was organised to ensure best practices in the application of concrete designs.

Speaking at the event, Makoju, who was represented by the Vice Chairman, CMAN, Mr. Jean-Christopher Barbant, said the current codes, when reviewed would ensure uniformity in applications.

He stated that while many engineering designers and consultants in Nigeria base their concrete design and specification on the British Code of Practice and other international standards, there is need for the country to develop one that would take adequate consideration of local factors

He said: "All over the world, particularly in advanced countries, regulatory authorities and practitioners in the building and construction industry develop standards and codes to guide construction professionals in effective specification of concrete grades and selection of cement types; thus ensuring some degree of uniformity in their applications of concretes in their countries

"Such standards and codes take adequate consideration of local factors such as environmental peculiarities, level of economic development, literacy level, and climate conditions.

"Such specifications and codes are then updated as required in the light of technological advancement and new realities. Nigeria is no exception to this general practice as regulatory bodies have also made efforts towards achieving these goals.

He added: "However, challenges remain as evident by the realities on ground in terms of practice and enforcement. We need to have our own relevant concrete code of practices and standards revised taking local conditions into consideration. It is also very important that our codes are robust and standards are robust, practical and uniformly and consistently applied in practice."

He expressed optimism that given the number of ongoing projects in the industry as well as backward integration policy of the federal government, the industry's installed capacity would rise to 40 million tonnes by 2015.

Also speaking at the event, the Director General, Standards Organisation of Nigeria, Dr. Joseph Odumodu, said the issue of quality had been a major challenge facing the regulatory agencies.

For instance, he said 32 trucks loaded with cement not registered in Nigeria, coming from Benin Republic were recently prevented from entering the shores of Nigeria. He added that the federal government should continue do all within its powers to protect the industry from sub-standard products.

Africa, Tanznia: Local Cement Firms Do Well in Competition


Tanzania: Local Cement Firms Do Well in Competition


The Tanzania Portland Cement Company (TPCC) and Tanga Cement Company have weathered challenges of the so-called cheap imports and new comers in the industry to post huge success last year in terms of profitability and output.

The two oldest cement giants are both in expansion move to increase capacity ahead of demand. TPCC which trades at the Dar es Salaam Stock Exchange (DSE) as Twiga is investing in a new cement mill, while Tanga Cement, trading at DSE as Simba have pumped in more money on a new kiln.

Last year Simba made a historic sale after it managed to sell over one million tonnes of cement, pushing up its net profit by 52 per cent. In the same year, Twiga despite all the odds retained market leadership after increased net profit by 22 per cent.

This remarkable achievement was received well by investors who continue to demand for the two listed cement firms at DSE, since the start of this year. DSE data shows that Simba shares appreciated by 0.83 per cent to 2,420/- while Twiga gained by 0.77 per cent to 2,620/- in the last three months.

Nevertheless, Simba, based in Tanga, sales volume grew up by 21 per cent to 257.92bn/- as a result of export sales that rose by 55 per cent last year, with pretax profit increasing to 55.93bn/- from 37.08bn/-.

Talking about export, Twiga said: "the new mill which is expected to be completed by mid-2014 will make TPCC the biggest cement producer in the subregion," said the firm's Board Chairman, Mr Jean - Marc Junon. The cement industry, looking at imports perception, has excelled despite the East African Community (EAC) states decision for the fourth time not to reinstate suspended duties on cement in the Common External Tariff.

May be the imports helped somewhat for the industry to look further internally and externally on its position and strategies accordingly to come up remarkably. Simba's acting Chairman, Prof Samuel His counterpart, Mr Junon, said despite the increased competition, "the company (Twiga) managed to increase dispatched volumes by 5 per cent. The turnover increased by about 15 per cent compared to 2011".

The output and sales increment was the results of cost cutting measures and also improving the availability of quality electricity. "The overhead costs were strictly controlled and the company's operation profit for the year increased by 34 per cent," Prof Wangwe said, adding that improved supply of electricity as compared to last year's also contributed to the cement manufacturer's profitability.

The costs also subdued following the fact that Simba used merely 1.91 per cent of own power generation compared to 6.9 per cent of 2011. On other hand, Twiga said the increase in cost of sales over the previous year is mainly due to inflation and energy costs. "(However) with improved efficiencies, the operating income increased by over 25 per cent compared with the previous year".

Then there is a question of repositioning of the two big cement manufacturers to counter competition that comes from new comers, which are in initial factor set up processes. Simba said its board of directors has approved the construction of the second clinker at the factory mid this year to increase output in the years ahead and meet demand, getting rid of imports.

The project, scheduled to be completed in 2015, will increase clinker production capability by 600,000 tons per year, more than double the current capacity. "This additional capacity is expected to satisfy the consistently high demand for cement from both the local and export markets," Prof Wangwe said.

Twiga said "is positioned to continue its market leadership, after completing the upgrade of one of the old kilns." And in another aspect in this year, it has also entered into a new business line by producing aggregates for the growing construction sector.

The cement industry development and achievements was pushed by a good economic outlook. In 2012, GDP grew by slightly below 6.4 per cent and this year forecast to go up by 6.8 per cent and construction sector, went up at a rate of around 8 per cent.

Last year, an Equity Research on Cement Sector Local Listed Companies conducted by Tanzania Securities, projected that the country is poised to become a net exporter of cement in the next two years. The projection is based on the fact that currently the country's production capacity stands at 3.25 million tonnes per annum that is expected to double in the next three years to 6.75 million tonnes.

And, according to the report, the cement industry is fully supported by strong demand from import dependent neighbouring countries of Burundi, Rwanda and Democratic Republic of Congo (DRC). "We consider the Tanzania's prevailing price of 120 US dollars per tonne to be competitively very low versus West Africa's 200 US dollars per tonne," the research analysts said:

"Our projections show that prices will continue to fall to between 90-105 US dollars per tonne in the medium term and translate into higher export levels to available markets (of Rwanda, Burundi, DRC or Zambia (with a 200 US dollars per tonne price) with higher prices."

Wangwe, said the firm overcame the industry challenges -- one of them being cheap imports to achieve the milestone sales. "The sales volume increase marks a significant milestone for Simba Cement, being the first time the company sold over one million tonnes of cement in one year," he said in a statement.


AFRICA, Uganda: Hima appeals over rights



UGANDA: Hima appeals over rights

Cement makers, Hima Cement Limited, say that they have successfully challenged the giving away of their vital limestone concession in Kasese, Western Uganda. 

Limestone is a main input in cement production. Hima is owned by French multinational giant, LaFarge.

According to David Njoroge, the company’s General Manager, they successfully challenged the move during an Administrative Review process that was conducted in accordance with the Mining Act.

It cited various instances of breach of the requirements of the law in the handover of its mining rights to the third party. Njoroge said the matter went to the High Court and has now progressed to the Court of Appeal. 

“A stay of the orders of the High Court has been applied for and the appeal process has been commenced seeking to overturn the ruling of the High Court,” Njoroge said.
Hima has been embroiled in a dispute for over a year with a company that sought to take away its core limestone reserves in Kasese. 
Njoroge in a statement to East African Business Week indicated that they challenged the court order because  Hima Cement Limited was originally registered in 1994 as Hima Cement (1994) Limited. 
It duly changed its name to the current Hima Cement Limited in 1999 and it has been filling its annual returns and all its company documents under the said name since 1999. 
“Indeed Hima Cement Limited has a certificate of change of name issued by the Registrar of Companies in 1999 signifying the said change,” Njoroge said in a statement.
It is on record that in 2010, Hima Cement Limited invested over $120 million in a new plant to double its production  capacity to 850,000 metric tonnes of cement per year.

The decision to make this investment was driven by the availability of adequate reserves of limestone in the now contested area to support the Plant and the secondary effect of taking away the mining lease would be the cessation of production at Hima. 

This decision was made will full knowledge and support from the Government of Uganda and elaborate investment plans were presented to the Department of Geological Surveys and Mines.

Hima Cement Limited pays over Ush40b ($16m) in taxes to the government making it one of the biggest tax payers. It directly and indirectly employs over 2,000 people ranging from its own. 

Ugandan staff employees, transporters, suppliers of raw materials for manufacture as well as distributors. 

This year, the company is scheduled to install a Ush8b ($3.2m) Bag Filter technology in its old plant which will reduce dust emissions and bring them to internationally accepted standards. 

It is also important to note that increased cement production has saved the country over $1b in foreign exchange which can be deployed elsewhere to improve infrastructure and provision of social services

Njoroge said that the Government has dealt with Hima Cement Limited under the said name since 1999.

AFRICA, Nigeria: Nigercem: Time To Roar Factory Engines


Nigercem: Time To Roar Factory Engines To Life Again


IN THE HEAT OF THE CONTROVERSY STALLING THE COMMENCEMENT OF PRODUCTION AT THE NIGERIAN CEMENT COMPANY PLC BASED IN EBONYI STATE COMES THE WARNING THAT THE CONTINUED CLOSURE OF THE CEMENT FACTORY MAY ROB THE STATE ADDITIONAL REVENUE IN TERMS OF TAXES AND DIVIDEND WHICH WILL WORSEN ITS CURRENT FINANCIAL SITUATION. THE STANDOFF WILL ALSO CONTINUE TO DENY THOUSANDS OF JOB SEEKERS PLACEMENT IN WHAT WOULD HAVE BEEN A JOB-SPINNING INDUSTRY, REPORTS FESTUS AKANBI

As Nigeria continues to flaunt its economic potentials to other members of the international community in a bid to attract foreign investors, economic affairs commentators have warned that unless conscious efforts are put in place to defend the sanctity of the previous investment decisions undertaken by the successive administrations, various road shows put in place to attract new investors will amount to playing to the gallery.


For instance, it is argued that as important as the various attempts being put in place to assure foreign investors of the readiness of the Nigerian government to offer some of the public enterprises for sale for better management, it will be difficult for the country to secure the commitment of the kind of investors needed to make the desired difference unless previous arrangements are tidied up.


For obvious reasons, privatisation in Nigeria has not been a popular reform. It has received so much criticism from labour, academia, and individuals. There have been numerous strikes against proposed sell-offs by unions fearing loss of jobs. While proponents of privatisation see that aspect of economic reform as an instrument of efficient resource management for rapid economic development and poverty reduction, some indigenes of the host communities often fear the loss of what they regarded as their share of the federal government assets. The ensuing controversies often stall the take off the projects, a development which is said to have forced some foreign investors to lose enthusiasm in Nigerian projects.


That is the scenario playing out in Ebonyi where the state government is locked in a protracted ownership crisis over the Nigerian Cement Company Plc (Nigercem).

It would be recalled that at a point, the federal government formulated a policy of gradually phasing out of cement importation. Consequent upon this, licences were granted for Greenfield plants while moribund cement plants were sold to investors that would redevelop them. It was this arrangement that placed Edo Cement Company Okpila in the hands of Bua Cement; Eastern Bulkcem took over Nigercem Nkalagu while Dangote group bought Benue Cement Company Gboko.


The federal government’s privatisation agenda especially in the cement industry appeared to be on course as Bua and Dangote group were able to turn around Edo Cement and BCC Gboko respectively. Dangote went ahead to develop two other green field plants at Obajana in Kogi State and Ibeshe in Ogun State as well as in other African countries like Zambia, Senegal etc. Curiously, Dangote avoided the South-east in the siting of his plants.


Frustrated by the failure of Bulkcem to meet its own part of the bargain, the state government was said to have resorted to extra-judicial means by shutting down the plant, revoking Nigercem’s certificate of occupancy and set up a Judicial Commission of Inquiry to investigate the state of affairs in the company.

Sanctity of Privatisation
However, with the crisis rocking the privatisation of The Nigerian Cement Company Plc (Nigercem), economic watchers said there is need for the federal government to defend the sanctity of its privatisation programme in order to restore confidence in investors and to give a lift to the economy of the state where the company is sited.


Today, Ebonyi State government is calling for a review of the privatisation process as it seeks the control of a greater chunk of the company’s shares, a move being contested by the new majority shareholders of the company, Ibeto Cement Company Limited.


The current wave of crisis was triggered off by a controversial advertorial signed by eight members of the National Assembly from Ebonyi State where issues bordering on the ownership of the embattled cement firm were raised. The advertorial, which justified the closure of the factory by the state government, also questioned the existing shareholding structure of the company.

The Posers
However, in a dramatic twist, another member of the National Assembly from the state, Peter Edeh, representing Ezza North/Ishielu Federal Constituency of the state dissociated himself from the current offensive against Ibeto Cement company.


According to Edeh, “if the Ebonyi State government were to successfully oust the Ibeto Group from Nigercem, what would be the implication for other investors including those in oil/gas industry in other parts of the country? Could the governors of Rivers, Bayelsa, and Akwa Ibom etc ask the oil majors to surrender their drilling sites and/or investments?”


Watchers of the unfolding scenario had expected a cessation of hostility on the part of the state with the coming on board of a new investor –Ibeto Cement Company Limited. Unfortunately, the controversy is yet to abate. THISDAY gathered that since Ibeto Cement Company Ltd acquired majority shares in Nigercem through its acquisition of Eastern Bulkcem Co. Ltd., none of its officials have been allowed entry into Nigercem premises.


An advertorial signed by Executive Director (Strategy, Projects and Public Affairs)Ibeto Cement Company Limited, Dr. Ben U. C. Aghazu explained that the Ebonyi State Government recognises the acquisition of Eastern Bulkcem by Ibeto Cement and the resulting restructuring of the board of Nigercem to reflect the new reality.


He explained that “The Ebonyi State Government nominated its representative to this new board. The Ebonyi State government also requested the issuance of its share certificate from this new board. The board complied by promptly delivering to the state government the share certificate duly signed by the new Chairman of Nigercem, Dr. Cletus M. Ibeto, and the new Company Secretary, Messsrs Udeh and Associates.”

Paying the Price
Some wondered whether Ebonyi which was listed among the seven highly indebted states could risk the bad publicity which the current standoff on Nigercem is generating.


Edeh believed the continued closure of the cement factory is robbing the state potential revenue capable of improving its financial position. He asked, “Who does the present stand-off which has prevented Nigercem from returning to production benefit? In a state with the highest unemployment rate, lowest IGR profile, and a generally falling economy, shouldn’t the revival of the only major factory be a noble goal for everyone to pursue?”


On the allegation that the government took over the factory because of stealing and fraud in the company, the management of Ibeto said if in fact there was fraud and exploitation going on at Nigercem under the management of the old Eastern Bulkcem, it was not only against the people of Ebonyi State; it must also be against over 28 thousand other Nigerians and organisations who are minority shareholders.


“The Companies and Allied Matters Act makes ample provision for the protection of minority shareholders against exploitation by the majority. If the Ebonyi State Government believed in the rule of law, it should have sought protection under the law and not resort to self-help by setting up a Judicial Commission of Inquiry and physically taking control of the factory, simply because it was located on its territory. Owing to the fact that Ebonyi State is part of the Federal Republic of Nigeria, the laws of the Federation must apply within its territory.


Owing to its inability to access the cement factory and the revocation of its certificate of occupancy, Eastern Bulkcem sued the Ebonyi State Government and obtained a ruling from the federal high court declaring the judicial commission set up by the state as illegal. The same court however ruled that Nigercem, as a party to the suit, which had prayed to have the revocation of its certificate of occupancy nullified, could only be determined by a court of jurisdiction on land matters; in other words, the state high court.


This was the sorry state of affairs at the plant when Ibeto Cement Company Limited in 2012 acquired Eastern Bulkcem. With the change of ownership, Ibeto Cement now controls 60 per cent of the shares in Nigercem, Ebonyi State Government, 10 per cent, while the public comprising institutions such as NICON Insurance Plc and the public own 30 per cent. But despite all efforts by the new owners – Ibeto Cement – to take possession of the plant and recover the certificate of occupancy, the state government has remained adamant and rejected all entreaties to reach an out of court settlement on the issue.

State Government’s Response
Chief Press Secretary to Ebonyi Governor, Dr. Onyekachi Eni, in a response to THISDAY enquiries last week, insisted  that the Ibeto Group has waged  sustained public attacks on the person of the Governor of Ebonyi State Chief Martin Elechi and the state government. “Ebonyi State Government wants Ibeto Group to handsoff Nigercem which it acquired through the back door. Ibeto Group treats Ebonyi people with contempt and believes that it can take over Nigercem by simply bribing some villagers and ignoring the state goverment which is incidentally a strategic equity holder in Nigercem. Ibeto Group is not interested in revamping Nigercem but it is desperate to acquire the company in order to ensure the renewal of its import licence by the federal government for cement becos its current licence will expire by 2017. Ebonyi State Governmentt is determined to assert is right over Nigercem.


“Going by the antecedents of Ibeto Group, it does not like to do business with anybody in line with due process. It prefers to operate through the backdoor. Apart from its current attempt to fraudulently acquire Nigercem, the Company had earlier created problems in two other communities in Ebonyi State where limestone is found in commercial quantities: Azuinyaba and Effium in Ishielu and Ohaukwu LGAs respectively. At those places, Ibeto played some villagers against others leading to violence and communal strife. The Company was later chased out of the communities by the locals. From our experience, Ibeto Group is a serial trouble maker which instigates strife as a means of acquiring people’s resources. It wants to repeat its usual tricks at Nigercem.”