Ohorongo shareholder wants bigger stake

09 May 2019 | Business

The Industrial Development Corporation, a South African development finance institution, has indicated that it wants to increase its shareholding in Ohorongo Cement.

Majority shareholder Schwenk Namibia wants to dispose of its shareholding in the cement factory and is negotiating a deal with a Sino-Singaporean Cement Company, International Cement Group.

Nevertheless, IDC spokesperson Zama Luthuli said the institution was looking at the possibility of enhancing its shareholding in Ohorongo Cement.

The IDC owns a 14% stake in Ohorongo Cement. “The IDC remains committed to Ohorongo. Further to this and in support of Namibia's indigenisation programme, it is our view that the locals (Namibians) should hold a considerable shareholding in Ohorongo.

“IDC, in consultation with other minority shareholders, is exploring possible opportunities aimed at achieving this objective,” Luthuli said.

She said the IDC and its local counterpart, the Development Bank of Namibia (DBN), had not been consulted about the planned sale of Schwenk Namibia's shareholding to ICG.

“IDC was neither consulted nor informed by Schwenk Namibia prior to (Schwenk) disposing of its stake in Ohorongo. We were only notified once the transaction had been concluded,” she said.

The DBN owns an 11% stake in Ohorongo Cement. The DBN recently said that it had not been consulted on Schwenk Namibia's plans to sell its portion to ICG.

“We will formally announce the way forward concerning our investments in Ohorongo Cement after consultations with our shareholder,” a DBN statement said. “Furthermore, the equity participation has the objective of promoting the efficient use of resources, promoting local participation, playing a catalytic role in attracting other investors and lenders, and mobilising the flow of domestic and external resources to financially viable projects, which also have significant economic merit,” it added.