DBN, a shareholder in Ohorongo Cement, has ruled out increasing its 11.73% stake or making an outright purchase of the company, which is currently up for sale.
Development Bank of Namibia (DBN) Acting Chief Executive Officer John Mbango said the bank is satisfied with its current position.
“For now, I think we are fairly okay with our shareholding, which is about 11%. We are focusing on other industries, and that industry is well established now. So we will just maintain the shareholding for the time being,” Mbango said told The Brief.
He added that DBN remains invested in the company and that the original investment had fulfilled its purpose.
“We haven’t sold our shareholding in Ohorongo Cement. We are still a shareholder. The investment itself was necessary at the time. I remember we had a very booming construction sector and, before the establishment of Ohorongo Cement, we used to import cement from South Africa,” Mbango said.
He explained that Ohorongo had helped reduce Namibia’s dependence on imported cement.
“With the establishment of that company, those imports were reduced quite significantly. In fact, we don’t import anymore. So it was a worthwhile investment for the country. As a bank, we achieved our goal of making sure that we create industries that were non-existent back then,” he said.
Mbango said DBN is now working with other shareholders to ensure continued operations.
“Now, what we are trying to do is regroup with the other shareholders, look at the challenges, and try to make sure that the industry keeps going again. Obviously, we don’t want to let the company down. We need to support it as much as we can so that production continues,” he said.
Ohorongo Cement’s ownership structure consists of Schwenk Namibia with 69.83%, the Industrial Development Corporation of South Africa with 14.27%, DBN with 11.73%, and the Development Bank of Southern Africa with 4.17%.
The Namibia Competition Commission recently blocked Ohorongo’s attempt to sell part of its business to rival Whale Rock Cement.
The company continues to face oversupply and subdued demand.
Namibia’s annual cement consumption remains around 600,000 tonnes, compared to installed production capacity of 2.6 million tonnes, a mismatch that has created sustained oversupply pressure according to the cement company.
