Kenya’s second-largest cement manufacturer ARM Cement is in search strategic investor to provide equity capital, its  Chief Executive Officer (CEO) Pradeep Paunrana said on Friday, after its shares plunged following problems in producing clinker and other challenges at its new Tanzanian operations.

 ARM has posted losses in recent years as returns from its expansion into Tanzania failed to meet expectations. It has sold some assets to reduce debt.

ARM’s shares have plunged 85 percent in the past four years, tumbling from 98 shillings ($0.95) per share to Friday’s close of 14.30 shillings.

According to Paunrana, “The process is open and it may be an injection of equity, it may be partial sale. It could be any structure the board will decide on.”

He said there had been “significant interest”, without offering details. ARM was being guided by a London advisory firm that specialises in the cement industry and building materials, he said, without naming it.

Global cement firms have been seeking to expand in Africa to take advantage of rapidly growing economies and major public transport and other infrastructure projects.

Some firms have sought to expand through acquisitions. Nigeria’s Dangote Cement, majority owned by Africa’s richest man Aliko Dangote, is keen to buy South Africa’s PPC.

ARM’s CEO also said the firm, which has total debt of $125 million, in talks with creditors to restructure $100 million of short and medium-term debt into 10-year borrowing.

He said ARM’s challenges stemmed from its operations in Tanzania, where it invested in a clinker plant and a grinding plant five years ago.

“The last three years in Tanzania we have had a very difficult operating environment,” he said. “It has left a gap in the balance sheet of the company which needs to be filled.”

 Paunrana said the situation had improved in recent months after the end of persistent coal shortages that hindered clinker output.

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