Ohorongo shares not on DBN radar

The Singaporean bourse has turned down International Cement Group's plan to purchase Schwenk Namibia's shareholding in Ohorongo Cement.

12 August 2019 | Business

The Development Bank of Namibia says it has not been approached to purchase shares Schwenk Namibia wanted to sell to Sino-Singaporean Company International Cement Group.

This follows the rejection of a bid by the company to buy Schwenk Namibia's shareholding in Ohorongo Cement by the Singapore Stock Exchange (SGX). The bank has also not indicated whether it remains open to the possibility of acquiring more shareholding, saying that such a decision would need to be well considered. The Singaporean bourse recently turned down International Cement Group 's (ICG) intent to purchase Schwenk Namibia's shareholding in Ohorongo Cement, saying that it did not see how the company would derive any benefit from the purchase of the shares. SGX said it is of the view that the proposed acquisition would not be profitable enough for ICG to satisfy stock exchange rules Business Times of Singapore reported.

SGX also noted that ICG does not have sufficient cash resources to fund the acquisition and intends to possibly obtain significant external loans from financial institutions and shareholders' loans.

“Such loans when considered with the potential losses of Schwenk Namibia will result in a material adverse financial impact on the enlarged group,” SGX said.

There was also no certainty that the target business will be able to generate sufficient profits to service the loans, and SGX said the acquisition would have put ICG out of a healthy financial position. When approached for comment to determine whether they were open to the possibility of acquiring more shareholding, the bank said it had not taken a position on a potential purchase and had not been approached either. DBN has not been approached to purchase Schwenk's shares in Ohorongo Cement, and the bank has not initiated talks for such acquisition,” its spokesperson Di-Anna Grobler told this publication when approached for comment.

According to her, DBN would have to properly assess any decision to buy into, or make an investment in, Ohorongo and would not go about it haphazardly. “Any investment decision is made subject to the bank having satisfied itself on the viability and developmental impact of the investment. We can therefore not speculate or pre-empt such a decision,” Grobler said. Grobler however did not respond to a question on whether its relationship with Schwenk Namibia had been affected in light of it wanting to dispose of its shareholding.

DBN had earlier said it would consult with government on the way forward when the news initially broke of Schwenk expressing its desire to sell to ICG. “The DBN is not familiar with ICG or its strategic intentions in Ohorongo Cement at this stage. However, a shareholders' meeting which includes ICG is scheduled to take place in due course,” the bank said in April in a statement.

The other minority shareholder in Ohorongo Cement, South African based lender the Industrial Development Corporation (IDC) has previously indicated to this publication that it would be open to acquiring a bigger stake. 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,” its spokesperson Zama Luthuli said in April.

Schwenk Namibia owns a 69.83% stake in Ohorongo Cement together with DBN with an 11% stake, the Industrial Development Corporation with a 14% stake and the Development Bank of Southern Africa with the remainder of the shareholding. The Otavi based plant has a capacity of 1 million tonnes annually. Schwenk Namibia also holds a 100% interest in alternative energy sourcing firm EFF. The firm had entered into a conditional sale and purchase agreement with vendor Schwenk Zement International GmbH for the 100%. It had intended to fund the proposed acquisition through third-party financing or borrowings.


Similar News


Erastus gets CEO nod

1 day - 13 December 2019 | Business

Licky Erastus has been appointment as the new CEO of Mobile Telecommunications Limited (MTC). Erastus had served as the company's acting CEO since June...

Alweendo supports Namdeb's tax break

2 days ago - 12 December 2019 | Business

Mines minister Tom Alweendo says he supports a proposed tax break for Namdeb, as anything that would help save the company from closure after 2023...

Seventh heaven for Chinese miner

3 days ago - 11 December 2019 | Business

The veil has been lifted on how a Chinese company has been mining copper in Namibia for over a decade while failing to pay over...

Existing fishing rights extended

3 days ago - 11 December 2019 | Business

Existing fishing rights holders have been granted permission by cabinet to net a third of the total allowable catch (TAC) for various species until the...

Meatco gets bulk of Norwegian quota

1 week ago - 05 December 2019 | Business

The Meat Board of Namibia has allocated next year's 1 600-tonne Norwegian beef export quota to Meatco and the Brukkaros abattoir. Meatco received a 1...

Synthetic diamonds pose a threat

1 week ago - 05 December 2019 | Business

Namdeb managing director Riaan Burger says although synthetic diamonds are a threat to his company; it is not something he is losing sleep over.He made...

PwC Namibia Walvis Bay office offers more than just...

1 week ago - 04 December 2019 | Business

Ansie Rossouw - As we approach the end of a very busy year, it is customary to reflect on the year gone by, as well...

Focus on people as well as profit

1 week ago - 04 December 2019 | Business

Zoe Tabary - Consumers have the power to make companies behave better and look beyond the bottom line, business leaders and activists said on Wednesday,...

Saudi Arabia’s Aramco casts IPO net

1 week ago - 04 December 2019 | Business

Anuj Chopra - From taboo-busting religious support to easy credit and fervent jingoism, Saudi Arabia pulled out all the stops to prop up Aramco's IPO...

Key zones saved from mining

1 week ago - 02 December 2019 | Business

With about 75% of mining revenue generated in protected areas, a policy has been developed that identifies nine areas in the country where prospecting and...

Latest News

Rundu chaos engulfs Swapo again

1 day - 13 December 2019 | Politics

The same chaos that engulfed the Rundu town council office-bearers election late last year, which dragged on to earlier this year, is once again playing...

Intercape confirms terrifying bus robbery

1 day - 13 December 2019 | Crime

While confirming a terrifying incident in which Intercape passengers were robbed at gunpoint on their way to Harare, the bus company did not answer questions...

Action, not promises

1 day - 13 December 2019 | Opinion

Acting fisheries minister Albert Kawana's utterances on Wednesday in Walvis Bay, where he addressed the fishing industry, must have come as music to the ears...

Erastus gets CEO nod

1 day - 13 December 2019 | Business

Licky Erastus has been appointment as the new CEO of Mobile Telecommunications Limited (MTC). Erastus had served as the company's acting CEO since June...

Dam levels still critical

1 day - 13 December 2019 | Disasters

While several dams have received inflows following good rains over the majority of the country, forecasts indicate that most parts of Namibia can expect only...

N$100k fine for ivory possession

1 day - 13 December 2019 | Crime

A man has been sentenced to a fine of N$100 00 or four years in prison for illegal possession of four elephant tusks. Bangorogile Motsokwe...

Students accuse Schlettwein of 'sabotage'

1 day - 13 December 2019 | Education

The Students' Union of Namibia (SUN) has accused finance minister Calle Schlettwein of sabotage, saying he is yet to release monies to pay their tuition...

Hundreds of thousands food insecure

1 day - 13 December 2019 | Disasters

ELLANIE SMIT Namibia’s agricultural sector has been contracting for the past five years and rural households and small-scale farmers have been severely affected, with 700...

Rundu welcomes ACC probe

1 day - 13 December 2019 | Disasters

KENYA KAMBOWE Rundu mayor Isak Kandingu has responded to a letter circulating on social media which alleges that the Rundu town council illegally swapped land...

Load More