Competition Authority backs acquisition of East Africa Portland Cement stake by Kalahari holdings

The Competition Authority of Kenya has backed the acquisition of Holcim’s 41.7% stake in East African Portland Cement Company (EAPCC) by Kalahari Holdings, stating the transaction will not alter control of the company.

Appearing before the National Assembly’s Trade and Investment Committee, Joel Omari, Director of Competition and Consumer Protection, clarified that the deal does not amount to an acquisition of control and, therefore, does not raise regulatory red flags regarding market dominance.

Omari added that the authority conducted a comprehensive review of the transaction, assessing potential impacts on market competition. This included evaluating the risk of monopolistic behaviour, shifts in market share control, and anti-competitive practices.

“The 41.7 % shareholding will not result in acquisition of control and additionally, the shares do not confer any veto rights that would amount to any indirect control; therefore the proposed transaction in our view does not amount to a merger as provided for under section 41. This is due to the fact that there is no change in control of the undertaking,” said Mr. Omari.

The Authority also examined current trends in the cement industry — including production, demand and supply patterns, as well as import-export dynamics — to determine whether the merger would affect consumer welfare, pricing, innovation, or fairness in the market.

However, concerns were raised by lawmakers on the implications of the takeover, especially regarding employment and market equity.

Mary Anne Keitany, Aldai MP and Vice Chair of the Committee, questioned the fate of EAPCC employees after the acquisition, warning of potential job losses and a decline in the company's competitiveness.

John Bwire, Taveta MP, echoed these sentiments, calling for a data-driven market analysis. He urged the government to undertake a comprehensive survey of cement companies' market share in Kenya, emphasizing that public interest should be a key consideration in such high-stake transactions.

“The source of your estimates that you are saying, Mombasa controls 33% of the entire cement market in Kenya, I question it myself,” said Bwire.