Omani-Somaliland Joint venture to establish cement factory in Berbera

Omani cement company is planning to set up a joint venture (JV) cement grinding plant in Berbera, Somaliland, with an estimated project cost of US$40mn.

Raysut Cement Company SAOG, the largest cement manufacturer in the Sultanate of Oman, has announced a partnership with MSG Group of Companies, a business-house based in the Republic of Somaliland, for the establishment of a major cement grinding plant at Berbera.

MSG Group of companies is a Somaliland-based multi-sector company owned by Mr. Mohamed Saeed Guedi. MSG is also the parent of company of Somcable telecom company which has an exclusive 25-year license to deploy fibre optic cable infrastructure and distribute internet within Somaliland.

‘Raysut Cement and MSG Group of Companies Limited have agreed to establish a cement grinding unit in Somaliland with a production capacity of 1mn tonnes of cement per annum,’ Raysut Cement said in a disclosure filed to the Muscat Securities Market.

The Muscat-listed firm revealed in a filing to the Capital Market Authority (CMA) on Thursday that the partnership plans to set up a 1 million tonnes per annum capacity cement plant with an estimated investment of around $40 million. Raysut Cement will own a 55 percent shareholding in the new project, with MSG retaining the balance 45 percent, Konstantionos Kouklidis, Plant Manager at Raysut Cement, stated.

The announcement comes just over a month after the Salalah-based cement firm, Raysut, firmed up plans to acquire Sohar Cement Company located in Suhar Industrial Estate — a move that effectively elevates Raysut Cement into the ranks of the largest cement producers in the Middle East.

Underscoring its appetite for strong growth, Raysut Cement revealed last December that it was exploring the potential acquisition of ARM Cement of Kenya as part of the company’s aggressive strategy to expand in East and Central Africa. Furthermore, the company is exploring opportunities in the Horn of Africa, Uganda, and Georgia as well.

In addition to its flagship cement plant at Raysut Industrial City in Salalah, the parent company also owns 100 percent the UAE-based Pioneer Cement Industries, an integrated cement plant operating in Ras Al Khaimah. It also has a 49 percent stake in Mukulla Raysut Trading and Investment Company in Yemen, which distributes cement sourced from the parent company.

The company added that it will provide additional information related to this project later.