The growth strategy aims to capitalize on Africa’s increasing infrastructure demands and enhance global market presence. As a result, Chinese cement manufacturers are ramping up competition with major players like Dangote and BUA to transform the cement industry landscape in Africa and create economic opportunities, according to reports.
Experts indicate that Nigeria’s cement market is heavily regulated and primarily controlled by three major companies, prompting foreign firms to enter the sector by acquiring stakes in existing companies. Huaxin Cement Co., a Chinese firm, is set to purchase Holcim AG’s 83.8% stake in Lafarge Africa for $1 billion, as previously reported by Legit.ng.
A statement from the group on December 1, 2024, revealed that the transaction is expected to be completed in 2025, pending regulatory approval. If the new owners choose not to delist from the Nigerian Exchange Limited (NGX), Lafarge’s market capitalization could potentially double. Currently, Lafarge is valued at approximately N934 billion, or about $556 million on the NGX. Holcim’s decision aligns with a pattern of divestments, including the sale of Lafarge Zambia to Huaxin Cement Co. in 2021 for $100 million, where Holcim held a 75% stake.
This acquisition will introduce Huaxin into Nigeria’s expanding cement market, which is largely dominated by Dangote Cement, the largest cement producer in Africa. Established in 1907, Huaxin ranks among the top 10 cement manufacturers in China and is listed on the Shanghai Stock Exchange with a market capitalization of $2.18 billion. In the nine months ending September 30, 2024, Huaxin reported revenues of $3.4 billion and a net profit of $157 million. During the same period, Lafarge Africa generated revenues of N479.5 billion and a net income of N60.1 billion, making Lafarge a more profitable target for Huaxin as it aims to improve its overall profit margins.
