The International Finance Corporation (IFC), a subsidiary of the World Bank Group, in collaboration with African and European partners has provided a financing package of $500 million into BUA Cement PLC. The aim of the investment is to part-finance and develop the ongoing expansion of two new, energy-efficient cement production lines for the group’s integrated cement plants in Kalambaina, Sokoto State, Nigeria. 

This investment is a $500 million financing package comprising:

• $160.5 million loan from IFC’s own account,
• $94.5 million loan through the Managed Co-Lending Portfolio Program (MCPP), 
• $245 million in parallel loans from syndication partners; the African Development Bank (AfDB) – $100 million, the Africa Finance Corporation (AFC) – $100 million, and the German Investment Corporation, Deutsche Investitions- und Entwicklungsgesellschaft (DEG) – $45 million.

Once complete, the plants will produce an additional 3 million tonnes of cement annually, while running partly on alternative fuels derived from waste and solar power. This will increase the plant’s capacity from 5 to 8 million tonnes per annum (mtpa). They will also create 12,000 direct and indirect jobs.

Abdul Samad Rabiu, the Chairman and Founder of BUA Group expressed the delight and expectation attached to the investment in a statement. He said “BUA is delighted to partner with IFC and other esteemed institutions in securing this $500 million facility to develop energy-efficient cement production capacity and strengthen our equipment and logistics capabilities in northern Nigeria. In line with our commitment to sustainability and ESG principles, this investment will create jobs and contribute to economic and infrastructural development within Nigeria and the greater Sahel region. We are particularly pleased to have successfully gone through the rigorous process with IFC, AfDB, AFC, and DEG, which validates our responsible business practices. By focusing on greener fuels and enhancing our equipment and logistics platform, BUA Cement is building a foundation for sustainable infrastructure growth and a more inclusive society,”

This investment positions BUA Cement for growth

Founded in 2019 as a result of a merger between Obu Cement Company Plc and CCNN Plc, this move is a positive step for BUA Cement, Nigeria’s second largest producer of cement, positioning them to become the foremost cement producing group. Their production capacity is currently estimated at 11 mtpa, 65.89% behind Dangote cement’s 32.25 mtpa. The introduction of two new production lines will provide a significant boost of 6 mtpa thus improving their competitiveness and allowing them to supply markets in Nigeria, Niger, and Burkina Faso.

IFC is a known investor in African initiatives with the aim of fostering economic growth in the region. Some of their previous investments include a $250m deal with Liquid Technologies to expand Data Centre Capacity in Africa, a $3m investment to help Kenyan pharmacy create regional retail chains in East Africa, and a $8.5m commitment in a Hospital Project Sponsored by AXA Mansard.

BUA Group Profile

BUA Group is a leading food, infrastructure, mining and manufacturing conglomerate Headquartered in Nigeria with diversified investments spanning key business sectors of the African economy. Their manufacturing arm, BUA Cements, is the second largest cement producer in the Nigerian market and the largest cement producer in the North Western region of the country. So far, Estate Intel tracks three projects under the BUA Group portfolio namely:

• Rosewood Garden Estate
• BUA Group Building
• BUA Office Development

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