By Isaac Blessings
ARM Cement Limited formerly known as Athi River Mining Limited is one of the leading cement, Lime and fertilizer producers and suppliers in the country accounting for 3.2 metric tonnes annually. Situated along Mzee Paulrana Road in Athi River, the company supplies cement as far as Uganda and the Democratic Republic of Congo (DRC). However, little is known about the founder and the people at the helm of its leadership.
In this article, WoK highlights all you need to know about ARM Cement Company.
ARM Cement Company Background
The company was founded as a mining company in 1974 by the late Harjivandas J. Paunrana. Despite lacking formal education and knowledge in the cement production space, it didn’t kill his dream and vision. He bought a piece of land in Athi River that contained limestone deposits but it was until 1996 that he set up the company and produced its first bag of cement. Since then the company has never looked back and continues to manufacture cement, exploit minerals and produce other products such as quick and hydrated lime, fertilizers, sodium silicate, calcium oxide, industrial minerals and special building materials.
What ARM Limited specializes in
The company produces the Rhino cement brand manufactured in their industries in Kaloleni, Mombasa and Athi River. It is also manufactured at their other branches in Tanga and Dar es Salaam in Tanzania. ARM cement also has shares in Kigali Cement Company in Rwanda and a cement company based in South Africa.
Minerals and Chemicals
This subsidiary is responsible for the production of Special Building Products, Sodium Silicate and Industrial minerals.
They produce agricultural fertilizers under the brand name ‘Mavuno fertilizer’ at the Athi River based factory.
This is a non-profit organization established in 2010 and seeks to help the communities where ARM Cement Company has a presence.
ARM Company Leadership and Shareholders
After the passing on of the founder, his son Mr. Pradeep Paunrana became the Chief Executive Officer (CEO) of the company at 24 years only. Boasting an MBA from Stern School of Business at the prestigious New York University, Pradeep was more than ready to steer the company to the next level. In 2015, Pradeep led the company into the Nairobi Securities Exchange (NSE) whereby major companies bought shares in the industry. As of 2014, the major shareholders were Amanat Investments Limited with 28 percent, Paunrana Pradeep Harjivandas with 18 percent, Stanbic bank with 7 percent, ARM Cement Limited ESOP with 4 percent, Standard Chartered Bank with 3 percent, Tannel World Limited and Anjana Pradeep Punrama with 1 percent while other investors making up for the remaining 35 percent.
ARM Company challenges and financial struggles
The struggles of ARM began after an unsuccessful and miscalculated attempt to try and join the Tanzanian market that is mainly dominated by Dangote Cement and Heilderberg’s Tanzania Portland Cement Company. The company’s market share plunged to just 10 per cent after the clicker plant it built in Tanzania in 2014 failed to generate income. According to The East African newspaper, ARM Cement was placed into administration in 2018 due to its inability to repay debts and meet its day to day financial requirements. George Weru and Muniu Thoithi of PricewaterhouseCoopers were then appointed as joint administrators.
The struggles didn’t stop there and on 8th May 2020, The Nairobi Stock Exchange suspended the trading of the company’s stock. The joint administrators went ahead and sold some of the company assets in Kenya, Tanzania, Rwanda and South Africa but the company assets couldn’t fetch a price to match the amount owed to secured and unsecured creditors. The joint administrators then recommended liquidation of the company, a process that was expected to commence on 30th September 2021. At the time the company went into receivership on 18th August 2018, its total debt was approximately US$284 million.
New owner of ARM Cement Company
On 13th October 2019, Devki group of companies which is owned by Narendra Raval acquired the company at a cost of Ksh 5 billion. The Devki group which also produces National cement has set aside Ksh 3.7 billion to modernize the transaction plants it has acquired. Devki group also retained the 1,100 employees that were employed by the ARM Company and plans to add even more workers.
“We are happy to inform you today that we have been able to complete the ARM acquisition and cleared all the transaction costs amounting up to Ksh 5 billion to PricWaterhouseCoopers (PwC). We will however retain all the staff because one of our goals as Devki group is to livelihood and create job opportunities,” Raval said during the handing over ceremony.