MPs Raise Alarm Over Planned Sale of Portland Cement Shares

The National Assembly Committee on Trade, Industry and Cooperatives has raised concerns about a planned sale of shares in East Africa Portland Cement (EAPC) to Kalahari Cement Limited, citing lack of transparency and public involvement.

Committee Chairperson Benard Shinali (Ikolomani) and Vice Chairperson Marianne Kitany (Aldai) said the deal had been “shrouded in secrecy,” with neither management nor employees consulted.

During a meeting with EAPC Managing Director Mohamed Adan, MPs learned that the sale involves 29.2% of the company’s authorised shares currently held by Cementia Holdings AG and Associated International Cement Ltd, subsidiaries of the Holcim Group, which has close ties to Bamburi Cement.

If approved, the deal would give Kalahari Cement a combined 41.7% stake in EAPC through its association with Bamburi.

Lawmakers questioned why the process was moving forward without public participation, noting that the government is the majority shareholder through the National Social Security Fund (27%) and the National Treasury (25.3%), bringing total state ownership to 52.3%.

“This is not just any private company. Kenyans, through their pensions and taxes, own a majority of this firm. Due diligence must be done, and employees and local communities must be involved,” said Hon. Kitany.

Adan confirmed that neither management nor staff had been engaged, warning that the secrecy had sparked fears of job losses. “Employees are understandably jittery, because livelihoods are at stake. Human capital is key to our success, and any change of ownership will affect them,” he said.

Funyula MP Wilberforce Oundo questioned why EAPC could not buy back the shares itself instead of waiting for Kalahari to purchase them. Adan said a share buyback was possible under the firm’s turnaround strategy but admitted that no proposal had been tabled.

MPs also raised governance concerns, with Kitany pointing out that the appointment of the board chair appeared to rely on government nomination rather than the company’s governing documents. Adan admitted that the company’s Articles of Association, last updated in 1933, were outdated and pledged to align them with the Companies Act and State Corporations Act.

The committee also demanded clarity on Kalahari’s long-term strategy, given its ties to Bamburi Cement, a direct competitor. Adan dismissed most of the claims as market speculation and said management had not received any official communication.

Lawmakers, however, expressed disbelief that such a major transaction could proceed without the board’s knowledge and vowed to investigate further, warning that the matter directly affects taxpayers, employees, and local communities in quarrying areas.