Dangote mulls bidding for South African cement maker PPC

(Bloomberg) – Aliko Dangote, is among those considering counteroffers for PPC Group Ltd. that could signal a bidding contest for South Africa’s largest cement maker, according to people familiar with the matter.

Dangote Cement Plc sees a bid for the Johannesburg-based company as a way to accelerate expansion outside its home market of Nigeria, said the people, who asked not to be named as the matter is private.
PPC will consider any rival offers to the joint approach by Canada’s Fairfax Financial Holdings Ltd. and domestic rival AfriSam Group Pty Ltd. and present them to shareholders in early October, one of the people said.

The value of PPC at 3:30 pm local time was ZAR 10.2 billion (US$792 million)

PPC shares jumped 2.9 percent to 6.38 rand as of 3:30 p.m. in Johannesburg, on track for the highest on a closing basis since April 25. That values the company at 10.2 billion rand ($792 million).

Switzerland-based LafargeHolcim Ltd., and Germany’s HeidelbergCement AG are also monitoring PPC’s situation.
Titan Cement Co. SA of Greece is looking at the South African company. The cement makers’ interest was sparked after Toronto-based Fairfax offered to buy 2 billion rand (US$155 million) of PPC’s shares and support a merger with AfriSam.

Spokespeople for Dangote, LafargeHolcim, HeidelbergCement, Titan, Fairfax and PPC declined to comment.

The future ownership of PPC is up for grabs after merger talks with AfriSam failed for a 2nd time last month following two-and-a-half years of on-off negotiations. Both companies have been struggling with high debt levels, which Fairfax offered to resolve with its unexpected entrance to the saga this week. The Toronto-based company said it would recapitalize AfriSam and enable it to settle outstanding loans.

Aliko Dangote, who has interests in sugar, flour and packaged food businesses as well as cement, has a net worth of US$11.4 billion, according to the Bloomberg Billionaires Index.

Dangote would be open to a sale of all or part of its cement operations in Pretoria-based Sephaku Holdings Ltd., unit to win regulatory approval for a takeover.