Chinese tycoon to control Namibia's cement industry

One Chinese businessman is set to assume effective control of Namibia's entire cement manufacturing industry after mines minister Modestus Amutse overturned a Namibia Competition Commission (NaCC) decision blocking Whale Rock Cement's acquisition of Ohorongo Cement.

The minister's approval last week clears the way for Wang Zhongke, who controls Hong Xiang Holdings Limited, the majority shareholder in Whale Rock Cement, to ultimately exercise control over both of Namibia's integrated cement manufacturers once the transaction is completed.

The acquisition overturns a July 2025 ruling by the NaCC which prohibited Whale Rock Cement from acquiring Schwenk Namibia (Pty) Ltd, the company that owns 69.83% of Ohorongo Cement.

The commission concluded that the transaction would eliminate effective competition by transforming Namibia's cement industry from a duopoly into a monopoly.

It warned that the merged undertaking could gain sufficient market power to increase cement prices, reduce output and product quality, limit customer choice and ultimately raise the cost of housing, commercial developments and national infrastructure projects.

Despite those concerns, Amutse approved the merger subject to several conditions.

These include a prohibition on merger-related retrenchments, continued regulatory oversight of the merged entity and the requirement that the Cheetah Cement plant remains operational. He also directed that local ownership should be increased to 40%.

The minister's decision immediately halted Cheetah Cement's planned retrenchment of 87 employees, with the company confirming that it had suspended the process following the approval.

Jobs at risk

Cheetah Cement has maintained that the merger is necessary to ensure the industry's long-term sustainability.

The company argues that operating two underutilised plants in a market with substantial excess capacity is no longer economically viable and that consolidating production will improve efficiency while preserving jobs that would otherwise be at risk.

The merger comes as Namibia's cement industry grapples with significant excess production capacity.

The domestic market consumes about 600 000 tonnes of cement annually, while the country's two integrated cement plants have a combined production capacity of about 2.6 million tonnes a year.

The surplus was initially expected to be absorbed through exports, but tightening import restrictions in neighbouring countries have sharply reduced those markets, leaving both producers competing for a relatively small domestic customer base.

According to Cheetah Cement, the two plants have been operating at only about 50% of their installed capacity, making consolidation increasingly attractive from a commercial perspective.

Holistic approach

NaCC spokesperson Dina //Gowases said Section 49 of the Competition Act empowers the minister to review the commission's determinations within 30 days and either overturn them or vary them by imposing conditions.

"In the case of Whale Rock Cement and Ohorongo, the minister gave certain conditions which the commission will monitor. Some of these are the market structure not to change, extended monopoly, excess pricing and layoffs," //Gowases said.

She said the minister's powers extend beyond competition considerations alone.

"The minister does not only overturn the commission's determination, but he also looks at the bigger picture. He feels that if the entities should not merge, it might cause job losses and distort quality," she explained.

Dominance on its own is not the determining factor, she added.

"The minister is looking holistically at the country's economy and looking at the issue of manufacturing."

Chinese ownership

The immediate acquiring company is Whale Rock Cement (Pty) Ltd, which owns and operates the cement plant near Otjiwarongo under the Cheetah Cement brand.

Competition commission proceedings identify Hong Xiang Holdings Limited, a Chinese company, as the majority shareholder of Whale Rock Cement, holding a 70% stake. Publicly available records do not disclose the remaining shareholders.

Through the approved transaction, Whale Rock Cement will acquire Schwenk Namibia (Pty) Ltd, whose principal asset is its controlling 69.83% shareholding in Ohorongo Cement.

Once the transaction is implemented, Whale Rock will control Namibia's two integrated cement plants through the same corporate group.

The ownership picture became clearer during NaCC enforcement proceedings, which found that Wang Zhongke had acquired Hong Xiang Holdings Limited from Fan Qingmei.

Because Hong Xiang Holdings already controlled 70% of Whale Rock Cement, the commission concluded that the transaction constituted a change in control of Whale Rock Cement itself.

The parties implemented the transaction without notifying the commission as required under the Competition Act, resulting in the commission imposing an administrative penalty of N$5 million.

That decision confirmed Hong Xiang Holdings as the immediate controlling shareholder of Whale Rock Cement. With the Ohorongo acquisition now approved, Wang will effectively control both of Namibia's cement manufacturers through the same corporate group.

The West China Cement connection

One of the more complex aspects of the transaction concerns West China Cement, one of China's largest cement producers, which is listed on the Hong Kong Stock Exchange.

When the commission blocked an earlier attempt to acquire Ohorongo Cement, it said its investigation had uncovered "relationship links" between West China Cement and Whale Rock Cement.

The commission concluded that those links meant the companies could not be regarded as fully independent competitors and that allowing the transaction would increase the likelihood of coordinated conduct in Namibia's cement market.

However, the commission's published decisions do not disclose the precise nature of those relationship links.