5th –
11th December 2003
Bamburi Completes ‘Restructuring’ Its Mombasa
Subsidiary
Baobab Farm, a subsidiary of Bamburi Cement has been restructured
to enhance its focus on originally envisaged core business
by downscaling the non-core activities.
A company statement issued mid-week explained:
Established in 1966 to spearhead quarry rehabilitation, ecosystem
management and environmental protection, the offshoot gradually
broadened its focus to include non-core commercial activities
among them fish farming, crocodile farming, poultry and ranching.
Bamburi Cement’s Human Resources and Organization Director,
Epimach Maritim said the restructuring and reorganization
of the farm followed a board decision reached after wide consultations
with staff and various welfare bodies.
“The decision to refocus Boabab Farm on its initial
core values has led to the downscaling of all the non-core
activities.
“This was purely a business decision aimed at putting
a lid on rising overhead costs as well as realistic divestiture”,
said Maritim.
The Farm will continue with rehabilitating Bamburi Cement
quarries on a continuous basis besides maintaining a clearly
balanced ecosystem, as has been the case with the world renown,
Haller Park, pioneered by legendary conservator, Dr. Rene
Haller.
Maritim noted that the experience gained by Boabab Farm has
been effectively replicated in a quarry rehabilitation process
at Hima Cement (Uganda), also subsidiary of Bamburi Cement.
Besides, Baobab Farm is now pioneering an afforestation initiative
in partnership with Woodlands 2000, an NGO, and WWF through
schools in arid and semi arid areas dubbed the “Green
Schools Project” as part of a wider initiative to not
only share the experience, but also return focus to originally
envisaged activities.
Maritime added that disposing of some of the company’s
non-strategic assets, including housing, was part of Bamburi’s
ongoing exercise to refocus the group on its core business.
As part of the restructuring programme the company has over
the years outsourced several of non-core activities such as
security, transportation, cleaning and catering services.
He termed the restructuring of Boabab Farm as a ‘win-win’
development since half of the 200 workers who were retained
had their income levels improved while those affected underwent
a staff redeployment programme, which involved entrepreneurial
training and financial support from a revolving fund.
“We believe that the net effect of the restructuring
programme has been positive with a sharper and well defined
focus and a clearer role of Boabab Farm.”
This statement was released following disparaging comments
that under the cover of ‘restructuring’ the now
French owned cement firm was in fact engaged in a local asset
stripping, callous property speculation and causing massive
long term staff lay-offs at Boabab farm.
There was a further alarming suggestion that ‘Haller
Park’ itself and its world famous quarry rehabilitation
project might suffer in the continuing squeeze for short term
share holder profits.
CEMENT Firm invests Sh700 million in new
plant
A cement firm is investing Sh700 million in a clinker plant,
and selling 33 per cent of its Tanzania plant.
Athi River Mining’s investment should double its cement
production capacity and substantially reduce it production
costs.
Tanga Cement and Cement Distributors Ltd will acquire Athi
River’s lime plant for $1 million (about Sh78 million).
A new subsidiary to handle its products is being set up in
South Africa.
Increase in cement capacity would represent a major shift
in its portfolio which is currently only on 50 per cent cement.
Previously, the firm has been getting clinkers from Bamburi
Cement, after it closed its old technology plant at Kaloleni,
amidst allegations of pollution.
Managing director Pradeep Paunrana told the Press after an
investor briefing that the firm was believed domestic cement
consumption will increase.
Sh500 million of the capital outlay will be covered by a term
loan, with another Sh200 million generated through internal
cash flow in the coming two years. It expects to glean earnings
of Sh150 million yearly.
The new rotary kiln is to be commissioned in 2006. Some 250
jobs will be created while its turnover will double to Sh2.2
billion. On the South African project, he said it would give
them toehold to import, pack and process Athi River Mining’s
products in Africa’s largest economy.
“Initially, the volume of business in South Africa is
expected to top $1 million, and we have ensured that we have
the capacity to double our production as the market is double
that of Kenya.”
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