Kenya Insights

Tag: Edhah Abdallah Munif

  • Lobby Group Wants Sale of EAPC To Controversial Tanzanian Tycoon Stopped Says Its Threatening Kenya’s Strategic Economic Interests

    Lobby Group Wants Sale of EAPC To Controversial Tanzanian Tycoon Stopped Says Its Threatening Kenya’s Strategic Economic Interests

    A consumer rights lobby has moved to the High Court seeking to block the sale of the National Social Security Fund’s stake in East African Portland Cement to a Tanzania-linked firm, arguing that the transaction threatens Kenya’s economic sovereignty and could lead to monopolistic control of the cement sector.

    The Consumer Federation of Kenya, through secretary general Stephen Mutoro, has filed a constitutional petition challenging the lawfulness of NSSF’s planned disposal of its 27 percent shareholding in the Athi River-based manufacturer to Kalahari Cement Limited for 1.6 billion shillings.

    The lobby warns that the deal could cede control of a strategic state-linked asset to foreign interests without proper regulatory scrutiny.

    Kalahari Cement, which is controlled by Tanzanian tycoon Edhah Abdallah Munif through Mauritius-based investment vehicles, already holds a 29.2 percent stake in EAPC acquired from Swiss multinational Holcim earlier this year for 718.7 million shillings.

    With Bamburi Cement, which is fully owned by Mr Munif’s Amsons Group, holding an additional 12.5 percent of EAPC, the proposed transaction would give the Tanzanian conglomerate effective control with a combined 68.7 percent stake.

    The petition, filed at the Milimani Constitutional and Human Rights Division, names the Capital Markets Authority, Competition Authority of Kenya, NSSF, Kalahari Cement, EAPC and the Attorney General as respondents.

    Cofek accuses regulators of facilitating what it terms a secretive transaction involving pension assets without public participation or compliance with constitutional safeguards on transparency and prudent financial management.

    Mr Mutoro argues in court papers that the NSSF stake, held in trust for Kenyan workers, cannot be transferred without full transparency, due process and regulatory scrutiny.

    The group contends that regulators failed to verify whether the transaction underwent mandatory valuation reviews, capital markets disclosures or competition assessments despite repeated requests for information.

    Cofek claims that CMA and CAK allegedly withheld critical information, violating constitutional rights related to access to information and fair administrative action.

    The lobby argues that the transaction excluded public input, transparent valuations and competitive bidding, while sidelining minority shareholders’ pre-emptive rights.

    The petition raises concerns about potential market concentration in Kenya’s cement industry.

    Mr Munif’s Amsons Group completed the full acquisition of Bamburi Cement in December last year for 23.6 billion shillings , giving it significant influence in the sector.

    Cofek warns that Kalahari Cement, though locally incorporated, acts as a proxy for its Tanzanian parent, enabling what it calls regulatory circumvention and anti-competitive consolidation.

    The lobby cites Amsons Group’s aggressive regional expansion as evidence of credible monopolistic risks that could inflate cement prices and harm consumers.

    At the close of the NSSF deal, Mr Munif would directly and indirectly control the equivalent of 31 percent of the Kenyan cement sector’s production capacity , setting up intensified competition with other billionaires in the industry including Narendra Raval and the Rai family.

    Cofek is seeking conservatory orders freezing any further steps in the transaction, including sale, transfer or registration of the NSSF shares in favor of Kalahari Cement.

    The group also wants the court to compel CMA to conduct a full compliance inquiry and direct CAK to carry out merger and competition assessments to determine whether the acquisition could create dominance or monopoly risks.

    The lobby argues that once shares are transferred, the harm will be irreversible, making it impossible to recover public leverage or forestall potential anti-competitive behavior.

    The group contends that damages would not be an adequate remedy since share transfers are irreversible and once control changes hands, judicial review would be rendered meaningless.

    EAPC’s strategic value extends beyond cement production.

    The company’s Athi River plant sits on 3,000 acres of prime land, and critics have questioned whether the real value lies in real estate rather than cement manufacturing.

    The firm traces its origins to 1933 as a colonial-era venture originally owned by Blue Triangle Limited and the Kenyan government before being privatized in the 1990s.

    NSSF acquired its 27 percent stake during a 2009 recapitalization meant to safeguard workers’ interests, a mandate Cofek argues is now compromised by the proposed sale.

    The pension fund has described the disposal as part of efforts to liquidate underperforming assets, but the timing and choice of beneficiary have drawn scrutiny.

    The case highlights broader questions about cross-border investment reciprocity.

    Tanzania mandates 51 percent local ownership in mining and energy sectors, while Kenya’s foreign investment rules remain less stringent.

    Critics argue that such asymmetries disadvantage Kenyan enterprises seeking opportunities abroad while exposing critical domestic sectors to foreign control.

    The High Court has scheduled a mention for January 27, 2026, to assess respondents’ filings in response to the petition.

    Regulators are expected to demonstrate that rigorous oversight was applied to the contested deal and explain their approval processes for the transaction.

    Kalahari Cement has stated that it does not intend to make a takeover offer for EAPC or delist the company from the Nairobi Securities Exchange after completion of the proposed transaction.

    The firm has described the investment as part of a strategic long-term plan aimed at advancing national industrialization and providing capital and technical resources to transform EAPC into one of Kenya’s leading cement manufacturers.

    However, Cofek maintains that the public interest demands full disclosure and competitive processes for disposal of state-linked assets, particularly those held by pension funds on behalf of workers.

    The petition frames the sale as a test of Kenya’s governance frameworks and the effectiveness of regulatory oversight in protecting strategic economic interests.

  • Exposed: How Debt-Ridden Tanzanian Tycoon Plans to Loot EAPC’s Sh21 Billion Land to Save Crumbling Bamburi Empire

    Exposed: How Debt-Ridden Tanzanian Tycoon Plans to Loot EAPC’s Sh21 Billion Land to Save Crumbling Bamburi Empire

    What began as a straightforward corporate acquisition has morphed into one of Kenya’s most contentious industrial deals, with Tanzanian businessman Edhah Abdallah Munif’s bid to acquire East African Portland Cement now facing accusations of being a calculated asset-stripping scheme disguised as investment.

    Fresh revelations emerging from parliamentary hearings and leaked briefings paint a troubling picture: a debt-laden investor attempting to acquire a newly profitable cement maker not to grow it, but to cannibalize its assets to rescue his failing Bamburi Cement operation.

    The deal’s optics have deteriorated sharply. Munif’s offer of Sh27.30 per share for a 29.2 percent stake in EAPC valuing the transaction at Sh718.7 million stands at less than half the company’s market price of Sh61.75.

    More strikingly, it represents a fraction of EAPC’s book value of Sh20.4 billion, with the company sitting on assets worth Sh35.19 billion, including 4,626 acres of prime freehold land.

    Parliament’s Trade, Industry and Cooperatives Committee has raised alarm bells over what MPs describe as a “substantially below market” transaction that undermines fairness and potentially threatens public interest.

    Committee vice-chairperson Maryanne Kitany questioned whether the acquisition would grant Munif’s vehicle, Kalahari Cement Limited, effective dominance over EAPC’s board decisions despite not having outright control.

    The concerns extend beyond mere pricing. Combined with his full ownership of Bamburi Cement, acquired last December for Sh23.6 billion, Munif would control 41.75 percent of EAPC, making him the single largest shareholder in a company where government entities the Treasury and National Social Security Fund hold 25 percent and 27 percent respectively.

    This concentration would give Munif board-level influence across two firms commanding 31 percent of Kenya’s 14.5 million tonne annual cement production capacity.

    EAPC Board Chairman Richard Mbithi warned MPs that the transaction would fundamentally alter the company’s governance dynamics, shifting power from multiple significant shareholders to a single controlling interest.

    The real danger, industry insiders suggest, lies in potential cross-pollination of strategic information between competing cement makers, including pricing strategies, market intelligence and operational secrets that could distort competition.

    But the plot thickens when examining Munif’s financial position.

    Sources familiar with Bamburi’s operations reveal the company is servicing crushing debt obligations of approximately Sh300 million monthly, stemming from the leveraged buyout financed largely through a Sh23 billion loan from KCB, with Munif reportedly contributing only Sh3 billion in equity.

    To meet these obligations, Bamburi has allegedly begun liquidating valuable assets, including staff quarters and portions of its land holdings in Mombasa, with even the iconic Haller Park reportedly on the auction block.

    This desperate financial situation has fueled suspicions that Munif’s interest in EAPC centers not on its cement production capabilities, but on its extensive land bank valued at over Sh21 billion.

    Critics argue the acquisition represents an opportunistic play to secure liquidatable assets that could be stripped to plug Bamburi’s financing gaps, potentially leaving EAPC operationally gutted and shareholders nursing massive losses.

    The timing appears calculated.

    EAPC has undergone a remarkable turnaround, with its share price surging 716 percent from Sh7.20 to current levels within twelve months, making it the Nairobi Securities Exchange’s top performer.

    The company has restored profitability after twelve years of losses, operates at 85 percent capacity, and pays salaries promptly.

    Yet Munif’s offer would value this success story at barely one-ninth of its net assets.

    Adding to the controversy, the Attorney General’s office has confirmed it provided no approvals, opinions or certifications for the proposed sale, and expressed concern that critical steps around public participation, constitutional compliance and protection against asset exploitation were not undertaken.

    Attorney General Ms. Dorcas Odour
    Attorney General Ms. Dorcas Odour

    The AG’s representatives told Parliament they had not reviewed transaction documents, making it impossible to guarantee protection of strategic national interests.

    More disturbing are allegations of improper influence.

    Sources indicate officials in the AG’s office face pressure from State House and individuals close to President William Ruto to retroactively approve the transaction.

    A coordinated public relations campaign, allegedly orchestrated by the same firm previously hired for the controversial Adani JKIA deal and working with State House’s digital team, has reportedly been mounted to discredit EAPC’s current leadership and silence opposition to the sale.

    The Competition Authority of Kenya has adopted a hands-off stance, with Director-General David Kemei telling Parliament the transaction doesn’t constitute a merger requiring review since the 41.7 percent stake wouldn’t grant direct control or veto rights.

    This interpretation, however, ignores the practical reality of board influence and the risks of information sharing between competing entities under common beneficial ownership.

    Capital Markets Authority CEO Wycliffe Shamiah acknowledged the pricing concerns but claimed powerlessness to intervene, arguing the consideration reflects a negotiated agreement between willing parties.

    He attributed EAPC’s volatile share price to speculative trading following Holcim’s announced exit from African markets.

    Industry executives aren’t buying these explanations. “This is not a growth acquisition. It’s a distress-driven play to strip EAPC of its assets to rescue Bamburi,” said one senior figure familiar with the matter.

    The absence of any announced capital investment plan or operational enhancement strategy for EAPC reinforces this view.

    EAPC’s board has proposed an alternative: conduct a share buyback of Holcim’s stake, then reissue the shares through a structured process that would deepen Kenya’s capital markets and give local investors, including ordinary Kenyans, an opportunity to participate.

    The company confirmed it has sufficient cash reserves to execute this strategy without external financing.

    The proposal aligns with the Companies Act 2015 and EAPC’s Articles of Association requirements that Munif’s transaction allegedly violates.

    It would also prevent the concentration risk that linking two heavily indebted cement makers under one beneficial owner would create.

    For Kenya, the stakes extend beyond one company.

    Allowing EAPC, a strategic national asset with decades of industrial heritage, to be acquired at fire-sale prices by a financially distressed investor raises fundamental questions about regulatory oversight, elite capture, and whether existing safeguards adequately protect critical industries from speculative raiders.

    The broader concern is whether this represents a pattern.

    How Munif secured Sh23 billion in financing with apparently limited collateral remains unexplained.

    If the EAPC transaction proceeds despite glaring compliance gaps, regulatory red flags, and absence of due process, it would signal that Kenya’s industrial crown jewels are available to well-connected buyers willing to pay pennies on the dollar, regardless of their financial stability or genuine investment intent.

    Parliament now faces a critical decision. Allowing this transaction to proceed could trigger mass layoffs, market instability, and the effective conversion of EAPC into a branch office servicing Bamburi’s debt rather than an independent competitor.

    Blocking it would send an important message that strategic assets cannot be seized through undervalued deals lacking proper legal foundation and transparent process.

    The Attorney General, Capital Markets Authority, Competition Authority and EAPC’s board must now answer whether protecting one investor’s interests outweighs safeguarding thousands of jobs, shareholder value, market competition, and the principle that national assets deserve transparent, lawful and commercially sound transactions.

    As one shareholder put it bluntly: “EAPC is a strategic national asset. Allowing it to be used as collateral to fix a failing investment elsewhere is not just bad business, it’s bad policy.”

    Whether regulators and political leadership agree will determine not just EAPC’s fate, but Kenya’s credibility in protecting its industrial base from opportunistic acquisition.

  • Asset-Stripping Concerns Cast Shadow Over Tanzanian Tycoon’s EAPC Acquisition

    Asset-Stripping Concerns Cast Shadow Over Tanzanian Tycoon’s EAPC Acquisition

    Nairobi — The blocked acquisition of East African Portland Cement Company (EAPC) by Tanzanian industrialist Edhah Abdallah Munif has exposed critical vulnerabilities in Kenya’s foreign investment oversight framework, raising fundamental questions about asset protection and market consolidation in the region’s cement sector.

    Kenyan parliamentarians have intervened to halt the proposed Sh718.7 million deal, which would have seen Munif acquire a 29.2 per cent stake in EAPC from Swiss multinational Holcim at Sh27.30 per share — representing a significant discount to the market price of Sh56 per share at the time of the intervention.

    The transaction, structured through Munif’s Nairobi-registered investment vehicle Kalahari Cement Limited, would have consolidated his position as EAPC’s largest shareholder, building on Bamburi Cement’s existing 12.5 per cent holding.

    This vertical integration strategy has prompted concerns about market concentration and potential asset-stripping activities.

    Debt Burden Drives Acquisition Strategy

    Analysis of Munif’s recent corporate activities reveals a pattern consistent with debt-driven asset acquisition rather than organic growth investment.

    Following his Sh23.6 billion leveraged acquisition of Bamburi Cement in December 2024, the company reported a substantial net loss of Sh905 million for the financial year ended December 2024, attributed primarily to foreign exchange losses linked to the divestiture of its Ugandan operations.

    Industry sources familiar with Bamburi’s financial position indicate the company faces monthly debt servicing obligations exceeding Sh300 million, necessitating aggressive asset monetisation strategies.

    The company has reportedly initiated the disposal of prime land holdings in Mombasa to manage its debt burden, a pattern that raises concerns about the intended treatment of EAPC’s substantial 909-acre property portfolio in Athi River.

    The acquisition timing coincides with EAPC’s operational turnaround, with management reporting improved financial performance and share price appreciation from Sh4 to Sh60 over a ten-month period.

    This recovery narrative makes the deeply discounted acquisition offer particularly contentious among shareholders and regulatory observers.

    Regulatory Compliance Gaps

    Parliamentary testimony from the Attorney General’s office identified significant procedural deficiencies in the proposed transaction, citing non-compliance with the Companies Act 2015 and EAPC’s Articles of Association.

    These findings highlight broader systemic issues in cross-border investment oversight, particularly regarding transactions involving strategic industrial assets.

    The Capital Markets Authority and the Competition Authority of Kenya face pressure to strengthen their assessment frameworks for foreign acquisitions, particularly those involving distressed buyers with substantial leverage positions.

    The EAPC case has become a litmus test for regulatory effectiveness in protecting strategic national assets from opportunistic acquisition strategies.

    Market Concentration Concerns

    Munif’s expansion strategy reflects broader consolidation trends in East Africa’s cement sector, where Tanzanian industrial groups are systematically acquiring assets across the region despite diplomatic tensions between Nairobi and Dar es Salaam.

    The cement industry’s capital-intensive nature and significant barriers to entry make it particularly susceptible to monopolistic behaviour when market participants pursue aggressive consolidation.

    EAPC

    The proposed EAPC acquisition would create a dominant market position for Munif’s cement operations in Kenya, potentially reducing competition and limiting pricing flexibility for consumers.

    Economic analysis suggests that such consolidation, when driven by financial distress rather than operational synergies, typically results in asset sweating rather than productive investment.

    Strategic Implications for Decision Makers

    The EAPC controversy illuminates several critical policy considerations for Kenyan authorities and regional economic planners.

    First, the regulatory framework for foreign direct investment requires strengthening to distinguish between genuine industrial investment and distressed asset acquisition.

    Current oversight mechanisms appear insufficient to assess the financial health and strategic intent of acquiring entities.

    Second, the case demonstrates the vulnerability of turnaround situations to opportunistic acquisition attempts.

    EAPC’s recovery trajectory makes it an attractive target precisely because its improved fundamentals can support debt service for over-leveraged acquirers. This creates perverse incentives that discourage operational excellence and long-term value creation.

    Third, the parliamentary intervention, while politically expedient, highlights the absence of clear regulatory mechanisms for addressing such situations. Ad hoc political solutions create uncertainty for legitimate investors and may deter beneficial foreign direct investment.

    Recommended Action Framework

    The EAPC situation requires a coordinated response addressing both immediate concerns and systemic vulnerabilities.

    The proposed share buyback programme represents a constructive alternative that preserves local ownership while maintaining access to international capital markets.

    However, successful implementation requires careful structuring to avoid creating liquidity constraints or governance complications.

    Regulatory authorities should expedite the development of enhanced due diligence requirements for acquisitions involving strategic industrial assets, including mandatory disclosure of debt structures, asset disposition plans, and operational investment commitments.

    The introduction of “fit and proper” assessments for significant shareholdings would provide additional protection against asset-stripping activities.

    Market participants require greater transparency regarding the financial health and strategic intentions of major shareholders, particularly in situations involving cross-border transactions.

    Enhanced disclosure requirements would enable more informed investment decisions and reduce information asymmetries that facilitate opportunistic behaviour.

    The EAPC acquisition controversy represents a critical juncture for Kenya’s foreign investment policy and industrial strategy.

    While foreign capital remains essential for economic development, the country must develop more sophisticated mechanisms for distinguishing between constructive investment and predatory acquisition behaviour.

    The resolution of this matter will establish important precedents for future cross-border transactions and signal Kenya’s commitment to protecting strategic industrial assets from opportunistic financial engineering.

    Success in managing this situation could enhance investor confidence and regulatory credibility, while failure may encourage similar problematic transactions.

    Decision makers must balance the legitimate needs of foreign investors with the protection of national economic interests, ensuring that industrial consolidation serves long-term productivity growth rather than short-term financial opportunism.

    The EAPC case provides an important opportunity to strengthen this balance and establish clearer parameters for acceptable foreign investment behaviour.

  • Red Flags Over Secret Deal With Purchase of Portland Cement Shares By Tanzanian Tycoon

    Red Flags Over Secret Deal With Purchase of Portland Cement Shares By Tanzanian Tycoon

    A controversial deal that could see Tanzanian billionaire Edhah Abdallah Munif acquire a controlling stake in Kenya’s East African Portland Cement Company (EAPC) has exposed serious concerns about asset stripping, market manipulation, and the erosion of Kenya’s industrial base.

    Parliament has now intervened, directing EAPC to pursue a share buyback instead of allowing the deeply discounted sale to proceed, as lawmakers raise alarm over what appears to be one of the most questionable corporate transactions in recent memory.

    The deal centers around Munif’s acquisition of 26.32 million EAPC shares from Swiss multinational Holcim using an investment firm known as Kalahari Cement at Sh27.30 each, valuing the deal at Sh718.7 million.

    However, Portland Cement shares closed trading at Sh56 a piece yesterday, placing the market value of the firm at Sh5 billion, revealing the staggering discount being offered to the Tanzanian investor.

    The mathematics are stark and troubling. At current market prices, the 29.2 percent stake being acquired would be worth Sh1.4 billion at the current share price, yet Munif is paying less than half that amount.

    This represents a discount so severe that it has prompted accusations of preferential treatment and potential insider dealing.

    More concerning is the true value of what Munif is acquiring. EAPC’s net asset or book value stands at Sh20.4 billion, as per the company’s latest audited financial results dated June 2024, with total assets of Sh35.19 billion against total liabilities of Sh14.79 billion.

    The bulk of this wealth lies in investment properties worth Sh21.23 billion, largely freehold land comprising 4,626 acres held under long-term lease arrangements.

    This land portfolio has become the elephant in the room.

    Members of the parliamentary committee on trade, industry and cooperatives reckon that the firm acquiring the stake is eyeing EAPC assets, notably land that is valued in excess of Sh20 billion.

    The company has already indicated plans to monetize this asset base, having won a court battle in 2023 against squatters who had occupied the land for about 10 years, with plans to sell off part of its expansive land holdings to raise Sh10 billion towards working capital.

    The timing and structure of the deal raise additional red flags.

    Munif’s Amsons Group completed the full acquisition of Bamburi Cement in December for Sh23.6 billion, cementing its hold on Kenya’s cement market.

    With Bamburi Cement already owning 12.5 percent of EAPC, he will emerge as the single-largest shareholder of the Athi River-based company with a 41.75 percent stake if the current deal proceeds.

    This consolidation is occurring as the East Africa cement market reached $2.66 billion in 2024 and is projected to climb to $2.98 billion by 2033, making control of major producers increasingly valuable.

    The strategic importance of EAPC, one of Kenya’s oldest cement manufacturers that operates as far as Uganda, cannot be understated in this context.

    Public interest concerns have intensified given the ownership structure of EAPC.

    The State and the National Social Security Fund (NSSF) have a combined stake of 52 percent in EAPC, with pensioners, through the NSSF, owning a 27 percent stake while the government, through the Treasury, owns a 25 percent stake.

    This means that millions of Kenyan workers and retirees stand to lose from any undervaluation of their pension fund investments.

    Activist lawyer Okiya Omtatah has sought to block the sale, arguing that should the deal go through, there will be massive losses for Kenyan pensioners.

    The concerns extend beyond immediate financial losses to questions about foreign control of strategic national assets.

    Parliament’s intervention reflects growing unease about the deal’s transparency and fairness.

    Members of the National Assembly Committee on Trade, Industry and Cooperatives want EAPC to buy back the shares at market value and sell for a profit later, with Kajiado South MP Samuel Parashina pointedly asking management, “Why are you waiting for the shares to be sold? Why not buy it back now?”

    EAPC Managing Director Mohammed Osman has acknowledged the feasibility of this alternative, telling the parliamentary committee that the firm will pursue the share buyback option if directed by Parliament, noting “We have the capacity to buy back the shares… We have the cash flow to settle the amount because we have turned around the company”.

    The dramatic recovery in EAPC’s share price supports this confidence.

    In the past year, the EAPC share price has gone up by 359 percent from Sh7.2 a unit, making it one of the top performers at the bourse in the period. This performance trajectory makes the discounted sale even more questionable.

    Regulatory authorities find themselves in an uncomfortable position.

    CMA chief executive Wyckliffe Shamiah said the regulator was powerless in dictating the offer price, arguing it reflects an agreement between buyer and seller.

    However, the Capital Markets Authority approved the controversial sale at a price it acknowledged was a steep discount, raising questions about regulatory oversight.

    The broader implications extend to Kenya’s industrial sovereignty and economic security. The cement industry represents critical infrastructure for national development, and the concentration of market power in foreign hands through questionably priced transactions sets a troubling precedent.

    As Parliament pushes for a share buyback solution, the EAPC case has become a test of Kenya’s ability to protect strategic national assets from predatory acquisition.

    The outcome will likely influence how similar deals are structured and scrutinized in the future, making it a watershed moment for corporate governance and public interest protection in Kenya’s capital markets.

    The red flags are clear and numerous: massive discounts to market value, even steeper discounts to book value, timing that benefits from market manipulation, consolidation of market power, and potential asset stripping of valuable land holdings.

    Whether Parliament’s intervention can prevent what many view as a fire sale of national assets remains to be seen, but the controversy has already exposed significant weaknesses in Kenya’s framework for protecting strategic investments from questionable foreign acquisition.

  • Tanzanian Tycoon Exposed in Insider Dealing Scandal Over Portland Cement Acquisition

    Tanzanian Tycoon Exposed in Insider Dealing Scandal Over Portland Cement Acquisition

    Edhah Abdallah Munif’s strategic moves raise serious questions about market manipulation and anti-competitive practices in Kenya’s cement industry

    Tanzanian business magnate Edhah Abdallah Munif finds himself at the center of a brewing scandal as competition authorities scrutinize his calculated acquisition strategy that has positioned him to control nearly one-third of Kenya’s cement market through potentially illegal information sharing arrangements.

    The controversy centers on Munif’s audacious bid to acquire an additional 29.2% stake in East Africa Portland Cement Company (EAPC) for Sh718.7 million, a deal that comes suspiciously close on the heels of his December 2024 acquisition of Bamburi Cement for Sh23.6 billion.

    The Web of Control

    What makes this acquisition particularly troubling is the intricate web of cross-ownership it creates. Through his investment vehicle Kalahari Cement, Munif is purchasing 26.32 million EAPC shares from Swiss multinational Holcim at Sh27.30 each – a staggering 74.5% discount to the market price of Sh47.65 per share.

    This discount alone raises red flags about potential insider dealings. Why would Holcim sell at such a significant loss unless there were underlying arrangements that benefited both parties at the expense of market transparency?

    The deal will make Munif the single-largest shareholder in EAPC with a 41.75% stake, while his Amsons Group already owns Bamburi Cement outright, which itself holds 12.5% of EAPC. This cross-ownership structure creates an alarming concentration of market power.

    Market Manipulation Concerns

    Industry analysts are questioning whether Munif’s strategy constitutes a systematic attempt to manipulate Kenya’s cement market. His companies will control the equivalent of 31% of the country’s cement production capacity of 14.5 million tonnes per annum, giving him unprecedented influence over pricing and supply chains.

    The Competition Authority of Kenya (CAK) has confirmed it will investigate the deal for potential violations of Section 21 of the Competition Act, which prohibits restrictive trade practices including price fixing, collusive tendering, and market division.

    “Cross-directorship may facilitate outlawed conduct such as the exchange of commercially sensitive information or market coordination,” warned CAK Director-General David Kemei, signaling the authority’s serious concerns about the arrangement.

    The Discount Scandal

    Perhaps most damning is the massive discount at which Munif is acquiring his EAPC stake. At yesterday’s closing price, EAPC shares traded at Sh47.65, yet Holcim is selling to Kalahari Cement at just Sh27.30 – a discount that suggests either gross undervaluation or preferential treatment.

    Even more shocking, both the market capitalization of Sh4.29 billion and Kalahari’s purchase valuation of Sh2.46 billion fall far below EAPC’s book value of Sh20.4 billion, raising serious questions about asset stripping or manipulation of company valuations.

    Regional Empire Building

    Munif’s cement empire extends beyond Kenya’s borders, creating potential for regional market manipulation. Through Pan African Cement, he controls Tanzania’s Mbeya Cement Company, while his diversified portfolio includes the Camel Oil fuel brand operating across Tanzania, Kenya, and Mozambique, plus freight operations through East Africa Warehousing and Kalahari Trans Zambia.

    This regional network provides multiple channels for potentially coordinating market activities across East Africa’s cement and related industries.

    The CAK has warned it may impose “structural or behavioural remedies” including limitations on directorships and restrictions on information sharing between Munif’s companies. However, critics argue that such measures may be insufficient to prevent the kind of market coordination that this ownership structure enables.

    The authority’s admission that it learned of the deal through media reports rather than formal notification also raises questions about regulatory oversight and whether Munif’s team deliberately avoided proper disclosure procedures.

    The cement industry has already shown signs of stress, with production declining from 9.62 million tonnes in 2023 to 8.85 million tonnes in 2024. Munif’s consolidation strategy comes at a time when the market can ill afford further concentration that could limit competition and inflate prices for consumers.

    His control over both Bamburi (22% market capacity) and significant influence in EAPC (8.96% capacity) positions him to potentially coordinate pricing and production decisions that could harm consumers and smaller competitors alike.

    The Billionaires’ Battle

    Industry observers describe the situation as setting up a “billionaires’ fight” for control of Kenya’s cement market, with Munif facing off against established players like the Rai family (Rai Cement) and Narendra Raval (National Cement, Athi River Mining, and Cemtech).

    However, Munif’s cross-ownership strategy gives him advantages that his competitors lack, potentially allowing him to access and coordinate sensitive business information across multiple major players.

    As the CAK prepares its formal investigation, the business community will be watching closely to see whether Kenya’s competition laws have sufficient teeth to prevent what appears to be a systematic attempt to consolidate market power through questionable acquisition practices.

    The scandal has broader implications for Kenya’s business environment and foreign investment climate. If wealthy foreign investors can circumvent competition laws through complex ownership structures and preferential deal-making, it undermines the principles of fair market competition that Kenya has worked to establish.

    The outcome of this case could set important precedents for how Kenya handles cross-ownership issues and whether its regulatory framework can effectively protect consumers and smaller businesses from anti-competitive practices by well-resourced international investors.