BUA To Consolidate Cement Arms, mull CCNN, Obu Cement Merger

Just like its major rivals did some years ago and in a move that may see competition in the nation’s building materials’ manufacturing industry become even keener, BUA Group, on Tuesday, October 29, 2019, announced plans to further consolidate its cement business.
Slated for combination, the group said in a statement, are its 2m Metric Tons Per Annum Cement Company of Northern Nigeria Plc, in Sokoto; and 6m mtpa Obu Cement Company Plc, Okpella, Edo State.
In its filing to regulators, BUA also announced that its newest 3m metric tonnes–$450m Sokoto-Kalambaina II cement plant, which it started constructing in 2018, is scheduled for completion in the second half of next year.
The proposed consolidation and addition of the Sokoto-Kalambaina II plant is expected to bring BUA Cement’s total installed capacity across all its cement holdings to 11m MTPA.
According to Abdul Samad Rabiu, Founder & Executive Chairman of BUA Group, the consolidation marks the culmination of the first phase of the BUA mid-term strategic plan for its cement businesses, which currently include four cement plants spread across Obu Cement Company and the Cement Company of Northern Nigeria.
The new $450m Plant, alongside another 48 megawatts power plant to complement the existing assets, while taking advantage of the growing cement market in Northern Nigeria and the West African region, Rabiu added.
“This consolidation will cement BUA’s position as the second-largest cement producer in Nigeria whilst also positioning it to take advantage of the combined synergies to effectively serve Northern and Southern Nigeria based on the strategic locations of these plants – as well as a sizeable export market.
“We intend to continue creating value for the benefit of shareholders of the consolidated company by maintaining our focus on outperforming the Nigerian cement industry across key indices through a laser-like commitment to excellent products and service delivery, operational efficiency as well as maintaining our leadership position in our home markets,” Rabiu added.
Analysts predict that this will put BUA Cement in a stronger position to compete even better and explore export opportunities in neighboring countries.