Institutions looking to invest in property in Nigeria face numerous hurdles, but perseverance, strict due diligence and an intimate knowledge of the idiosyncrasies of the property environment can lead to a measure of success

The Rezidor Hotel Group is expanding further into Africa, with three more hotels planned in Nigeria in addition to planned hotels in three other African countries, the group said yesterday.

NIGERIA's leading cement and building materials firm, Dangote Cement, and Sephaku Cement, have signed a shareholders agreement paving the way for the start of a R3bn project to build a cement plant in North West.

Construction IndustryThe agreement, announced on Friday, is the second leg of Dangote’s strategy to enter the highly lucrative South African market, following its acquisition of a 19,8% stake through a private placement in Sephaku Cement in April. The Nigerian firm hopes to increase its stake to 45% eventually.

The partners said they now had the operational framework to kick-start the project, which they billed as the first black-owned cement plant in SA. It would have an annual capacity of

2,2-million tons. They said talks were being held with technical partners before construction started.

Sephaku Cement is a subsidiary of black economic empowerment- controlled Sephaku Holdings, which has interests in the mineral sector. Dangote Cement is part of Nigeria’s largest diversified group, Dangote Industries, and also has operations in Benin, Ghana, Senegal and SA. The company said it aimed to be a multinational corporation and was eyeing at least 10 more African countries.

The two partners said the South African plant would be the largest single-line cement plant in the country.

Construction would begin in January and the first cement should be ready for delivery by the end of 2010.

Sephaku Holdings, as the majority shareholder in Sephaku Cement with a 55% stake, would provide the majority of the management team, and was finalising debt funding needed to finance the project.

Demand for cement in SA is set to continue to rise due to a slew of billion rand construction projects, among them the government's road-building programme, privately owned shopping complexes, and infrastructure and stadiums to meet the influx of visitors for the 2010 Soccer World Cup.

Analysts say despite the lull in housing construction in response to tightening credit conditions and waning demand as cash-strapped consumers prefer to rent, construction firms such as Group 5 and Murrary & Roberts have full order books that should keep them busy beyond 2010.

Dangote Cement CEO Tony Hadley said the joint venture was a key part of his group's pan-African expansion programme and provided direct access to the large South African market.

“We are delighted to be announcing that the joint venture is moving ahead smoothly and look forward to beginning the construction process,” he said.

“Dangote Cement is set to achieve 26-million tons of production capacity in Nigeria by 2010 and 50-million tons of production capacity overall by 2012.”

Sephaku Holdings chairman Lelau Mohuba said his group had a broader vision to become a major player in the local economy and across Africa.

He said the new plant was the first black-owned plant in SA and marked a “critical milestone (for the group) which was growing from exploration to development".

Sephaku Cement CEO Pieter Fourie said despite a slowdown in demand for cement since record levels achieved last year, the medium- to long-term forecast showed significant growth opportunities in the local market.

 

Wednesday, 04 June 2008 02:00

Go north, developers told

South African property investors have to start investing in there rest of the continent because there are "major opportunities being overlooked", says Wayne van der Vent, head of property investments at the Public Investments Corporation.

Thursday, 15 May 2008 02:00

Asset managers look to Africa

South African institutional asset managers are increasingly refocusing their attention to real estate acquisitions in the rest of Africa, says property services group JHI.

Monday, 07 April 2008 02:00

Food chain spreads its wings globally

Shoprite is steadily advancing its presence on the continent, with two supermarkets planned for the Democratic Republic of Congo and an initiative in place to find suitable sites in Nigeria

Thursday, 30 August 2007 02:00

Sun focuses on Chile, Nigeria

Hotel and leisure group Sun International said it would focus on its Chilean and Nigerian projects in the year ahead

Wednesday, 29 November 2006 02:00

Tanzania’s first shopping mall on track

Anchored by two of South Africa’s retail stalwarts – Game and Shoprite – the 19 000m² Mlimani City mall became Tanzania’s first fully-enclosed, air-conditioned shopping centre when it opened mid November says Broll chief executive officer Arnold Meyer.

Friday, 17 February 2006 02:00

Group Five to revisit over-border work

Group Five is to revisit its level of over-border work as a result of the SA Government's infrastructure budget, says Mike Lomas, the company's CEO

Page 7 of 9

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