MPs Question Sale of 29% Stake in East African Portland Cement

The National Assembly Committee on Trade, Industry and Cooperatives has raised concerns over the proposed sale of a 29.2 percent stake in East African Portland Cement (EAPC) to Kalahari Cement Limited.

The committee, chaired by Ikolomani MP Benard Shinali, met with key stakeholders including the EAPC Board led by Chairperson Brig. (Rtd) Richard Mbithi, Managing Director Mohamed Adan, officials from the National Treasury, the Attorney General’s Office, and the Competition Authority of Kenya.

Lawmakers, led by Shinali and Vice Chairperson Aldai MP Marianne Kitany, questioned why the transaction appeared to have been done in secrecy without consulting the company’s management or employees.

The shares under sale are currently owned by Cementia Holdings AG and Associated International Cement Ltd, both linked to the Holcim Group, which also has ties to Bamburi Cement. If completed, the deal would give Kalahari Cement a 41.7 percent stake in EAPC through its association with Bamburi.

The Attorney General’s Office told MPs it was not consulted and only learned about the sale through a public notice, raising legal questions about whether the transaction aligns with the Capital Markets Act and the Companies Act.

Treasury officials insisted that the government’s 25 percent shareholding, together with the 27 percent held by the National Social Security Fund (NSSF), remains intact. Lawrence Kibet, Director General for Investment and Portfolio Management, said the sale involved private shareholders and did not affect public ownership.

But MPs questioned why the Treasury was defending a deal it was not directly involved in. They also criticised the proposed price of Sh27.30 per share, saying it is far below the current market value of Sh58–Sh64 at the Nairobi Securities Exchange.

The EAPC board warned that the sale could change the company’s ownership structure, giving the new shareholder, linked to both Kalahari and Bamburi, significant control over the company. They also argued that the deal undervalues EAPC, which owns vast tracts of land and other strategic assets, and could reduce the influence of public shareholders.

Committee chair Shinali said Parliament has a duty to protect public interest in strategic national assets.

“We must ensure that such transactions are transparent, fair, and in the best interest of all shareholders, including the government and the people of Kenya,” he said.

The committee directed stakeholders to provide more information on the legality of the deal, how the valuation was done, and its impact on the company’s structure. Lawmakers also called for greater transparency and scrutiny in future transactions involving key national assets.