This archive report was first published on 9 December 2019.
Published on December 9, 2019, the Commonwealth Development Corporation (CDC) has suffered a significant loss after writing off 97% of its equity investment in ARM cement.
The UK investment fund had invested KSh14 billion in the collapsed cement maker in 2016, its first direct investment in the cement industry in Africa.
As a result of the write-off, CDC is left with a £2.8 million (KSh372 million) capital commitment, ceding its 42% ownership in the company to receiver managers PwC.
The move comes as PwC sells ARM's assets to recover debts, following the collapse of the cement maker.
ARM had previously stated that the funds paid existing loans at the time and improved the firm's financial position, while also helping to develop the company to meet the growing demand for sustainably produced cement across sub-Saharan Africa.
Devki Group's National Cement has taken over ARM Cement, with the Tanzanian unit of the company being acquired by a Chinese firm in a separate deal.
CDC has committed to invest $4.5 billion from 2018 to 2021 across Africa, with other investments in Kenya including the Malindi Solar Project, I & M Holdings, Africa Logistics Properties, and Garden City.
