Lucky Cement Ltd. (LUCK), Pakistan’s biggest producer of the building material, plans to form a joint venture with Groupe Rawji of Democratic Republic of Congo to build a one million-ton capacity plant in the African nation.
The factory will be completed in about three years after construction begins in the next 3-5 months, Abid Muhammad Ganatra, director of finance at Lucky Cement, said in a telephone interview on Aug. 3.
Lucky Cement will pay $40 million for a 50 percent stake in the project, it said in a statement to the Karachi Stock Exchange on Aug. 1. As much as 54 percent of the $175 million cost for the factory will be raised through debt from multilateral institutions, according to the company.
Groupe Rawji is in talks with Lucky Cement to set up the factory, Pravin Sawant, the group’s chief financial officer, said in a telephone interview yesterday from Congo.
Lucky Cement is planning the factory in Congo as the nation seeks to rebuild infrastructure destroyed in more than a decade of war that started in the mid-1990s. Germany’s HeidelbergCement AG last year agreed to buy a majority stake in three cement plants that account for about two-thirds of the country’s output.
Factories in Congo produce 780,000 tons of cement annually, less than a quarter of the annual requirement of 3.2 million tons, according to the nation’s Portfolio Ministry. In May, the government removed tariffs on imported cement to help the construction industry.
Groupe Rawji began operations in Congo in 1910, according to its website. Its businesses include trading, manufacturing and banking.