Pembani, Shanduka merger set for big cement changes
THE merger between Pembani Group and Shanduka has been concluded and the new industrial holding company is ready to shake things up.
On Monday Pembani, which has a R9bn portfolio after the tie-up, said the cement industry, in which it is a key player, had a duty to respond to disruptions caused by the entrance of new players, cheap imports and expanded capacity.
“Businesses have a duty to respond to changes,” said Pembani CEO Kennedy Bungane.
Mr Bungane said the group would pursue opportunities in the rest of sub-Saharan Africa. Pembani’s 20% investment in Engen is one of its more prominent assets and the fuel retailer has operations in 17 countries across the continent.
But the first substantial move by Pembani is likely to be in the cement industry. Last year Afrisam, which Pembani controls, made an unsuccessful bid for larger competitor PPC.
Mr Bungane said the industry had undergone permanent changes. “The cement industry in SA has changed radically and permanently,” he said. “I do not rule out a response by the market to these disruptions.”
Afrisam wrote to PPC, SA’s largest cement maker, in December last year, offering a combination of the entities.
After considering the proposal — but without presenting it to a shareholder vote — the PPC board rejected the overture in March, saying it did not believe there would be enough synergies to justify a merger.