Kenyan lawmakers are raising red flags over a proposed acquisition of shares in East Africa Portland Cement (EAPC) by Tanzania-based Kalahari Cement, warning that the deal lacks transparency and could jeopardize public interest.
Members of Parliament from the Committee on Trade, Industry and Cooperatives issued a statement on September 16, saying they may recommend halting the transaction unless full disclosure and public participation are guaranteed.
Committee Chairperson Benard Shinali (Ikolomani) and Vice Chairperson Marianne Kitany (Aldai) said the proposed sale, involving a 29.2% stake currently held by Swiss-owned Cementia Holdings AG and Associated International Cement Ltd was moving ahead without consulting the company’s management, employees, or key stakeholders, including the government, which holds a controlling 52.3% stake.
“This is not just any private company. Kenyans, through their pensions and taxes, own a majority of this firm,” said Kitany. “Due diligence must be done, and employees and local communities must be involved.”
If successful, the deal would give Kalahari Cement, which has ties to Bamburi Cement, a total of 41.7% control of EAPC, raising concerns of market concentration and potential conflict of interest in the sector.
Selling of East Africa Portland Cement Shares
During a session with EAPC Managing Director Mohamed Adan, MPs were told the company’s leadership had not been involved in discussions around the deal, sparking fears of job losses and governance risks.
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“Employees are understandably jittery, because livelihoods are at stake,” Adan said. “Human capital is key to our success, and any change of ownership will affect them.”
The MPs questioned why EAPC, which is undergoing a financial turnaround, had not considered buying back the shares itself.
Wilberforce Oundo (Funyula) criticized the company’s passive stance, asking, “Why wait for Kalahari to buy, then consider repurchasing?”
Adan confirmed a buyback could be viable given recent improvements in cash flow, but admitted no formal proposal had been tabled.
Irregularities in Board Leadership
Governance issues also emerged during the meeting. Kitany pointed to irregularities in the board’s leadership structure, noting that the appointment of the chair appears to be driven by government nomination rather than the company’s own governance framework.
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Adan acknowledged that the firm’s Articles of Association, last updated in 1933, are outdated and said reforms were underway to align them with the Companies Act and the State Corporations Act.
Lawmakers also pressed for clarity on Kalahari Cement’s intentions, citing its links to Bamburi Cement a direct competitor.
Adan said most of the available information was speculative and that no formal communication had been received.
With growing concern over the opaque nature of the deal, MPs vowed to intensify oversight.
“Where there is no public participation, Parliament must exercise its oversight duty. This deal touches on taxpayers, employees, and local communities in quarrying areas, and we cannot allow it to proceed in secrecy,” the committee said.
The committee pledged to further investigate the transaction, with several members expressing disbelief that such a significant move could occur without the board’s full awareness.
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