Kenya: Lafarge may be forced to surrender assets with crackdown

Kenya competition regulators are weighing possible forced divestitures on the world’s number two cement maker Lafarge, according to reports, as a probe continues into the company’s high influence in the nation.

Reports say Lafarge has a 59 percent stake in Bambury Cement and a 42 percent stake in East Africa Portland Cement. The ownership may lead to the Competition Authority of Kenya requiring divestitures from the French company.

Lafarge is gearing up for a mega-merger with industry leader Holcim, a $40 billion merger that has industry insiders eyeing probable forced sales to secure regulatory approval for the deal.

But Lafarge is facing regulatory scrutiny of another kind in Kenya, where regulators are probing the company and other cement makers following disputes between the government and shareholders over East Africa Portland Cement and Lafarge’s stake in the company, also know and EAPCC. The nation’s treasury holds a 24 percent stake in EAPCC, and state-owned National Social Security Fund has a 27 percent share in it.

Critics say Lafarge holds too much market dominance in the country. Regulator findings are due to be released next month.

Full content: Businessweek

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