Muscat: Raysut Cement Company (RCC), Oman’s largest cement manufacturer and a major player in the regional market, on Sunday announced joining hands with MSG Group in East Africa in a joint venture to set up a US$40 million cement grinding unit in Berbera, Somaliland.
In a statement following a regulatory filing on the Muscat Securities Market (MSM), Raysut Cement said, the setting up of the grinding plant was yet another step to advance its continuing aggressive expansion strategy into African markets.
“Raysut has charted out a growth course across African and other global markets in line with the opportunities presented and within this strategy, East Africa is a major focus. The joint venture with MSG Group will help us strengthen Raysut’s ambitious foray into Somaliland and further endorse our growth vision,” said Raysut Cement Chief Executive Joey Ghose.
Raysut Cement will own 55 per cent in the joint venture and the remaining will be held by MSG Group in the grinding unit which will have an annual capacity of one million tonnes.
The MSG Group with headquarters in United Arab Emirates (UAE) and Djibouti is a conglomerate with subsidiaries in various business sectors ranging from manufacturing, telecommunication, petroleum, energy, export and importing of goods and logistics management.
The group is one of the largest and leading industrial conglomerates in the Horn of East Africa.
Ghose said the tendering process for the engineering, procurement and construction (EPC) contract for the Berbera plant has already been floated and land has been acquired. Site works are expected to commence this week and the project is expected to be completed by first quarter, 2020.
Raysut Cement, listed on MSM, had earlier outlined its plans to expand its reach through acquisitions in Africa. Apart from Africa, Raysut Cement will also be looking at India in a second phase, to expand through acquisitions.
“Our acquisitions as well as joint ventures are aimed at eventually increasing our capacity to 20 million tonnes per annum and help us enhance our contribution to nation building in the markets we are present,” said Ghose.
The current capacity of Raysut Cement stands at 6.4 million tonnes per annum. The company had posted a growth of 26.6 per cent in revenues last year with turnover recorded at OMR91 million, a significant growth from OMR71.8 million in 2017.
Earlier this year, Raysut had also announced the complete acquisition of Sohar Cement Factory at a value of US$60 million.
Times of Oman
