HeidelbergCement and IFC, a member of the World Bank Group, have signed an agreement to support the development of local infrastructure in sub-Saharan Africa by increasing the local supply of cement. Under the agreement, IFC and its financial partners will inject equity of up to US$ 180 million in exchange for a minority stake in HeidelbergCement Group’s operations in Africa. HeidelbergCement is committed to use the proceeds to invest in the expansion of local cement capacities in sub-Saharan countries supported by the International Development Association (IDA).
“We are very happy about the partnership with IFC that creates a win-win situation for all parties involved,” explains Dr. Bernd Scheifele, CEO of HeidelbergCement. “Through the co-operation with IFC, HeidelbergCement secures attractive equity financing for the development of local cement capacities in Africa. In this partnership we will contribute our long-standing international experience in the construction material industry and strong governance, ethical and environmental management policies. The investment programme will stimulate the improvement of local infrastructure and housing, create additional jobs and improve environmental standards.”
Dimitris Tsitsiragos, IFC Director for Global Manufacturing and Services, said, “IFC’s support of HeidelbergCement’s strategic expansion will increase the supply of locally produced cement in the region and help stimulate the development of infrastructure. It will also improve production standards and help create employment opportunities.”
IFC and its financial partners, which include PROPARCO, will inject equity by way of a capital increase in Scancem International ANS, a subsidiary of HeidelbergCement that runs the company’s operations in Africa. The initial capital injection will amount to US$ 60 million. The total equity contribution may be increased up to US$ 180 million. HeidelbergCement will use the proceeds from the capital injections to expand its operations in sub-Saharan IDA countries. Part of the initial capital injection will be used to expand the cement mill capacity in Liberia. Additional projects envisaged include the construction and upgrade of mill and kiln capacities in Ghana, Togo and Gabon. The projects are expected to be implemented by 2013.
Read the article online at: https://www.worldcement.com/africa-middle-east/24052010/heidelbergcement_signs_agreement_with_ifc/