Next stop, Nigeria: China cement giant Huaxin’s African expansion spree

The Shanghai-listed company’s US$1 billion acquisition plans are its latest move into Africa as it hedges against shrinking domestic margins

Reading Time:2 minutes

Chinese cement maker Huaxin has been expanding into Africa as a counterbalance to declining demand in China. Photo: Shutterstock

Published: 2:00pm, 16 Dec 2024Updated: 2:15pm, 16 Dec 2024

For about four years, China’s Huaxin Cement has been acquiring or building manufacturing operations in six African countries – part of an overseas expansion spree to hedge against shrinking profit margins at home.

The next stop is Nigeria, Africa’s most populous nation, where Huaxin is set to buy an 84 per cent stake in Swiss building materials maker Holcim’s shares in Lafarge Africa, in a deal worth US$1 billion.

Lafarge Africa operates four cement plants in Nigeria, with a combined capacity of 10.35 million tonnes per year.

According to data from this year’s Global Cement Directory, Huaxin has 10 cement plants in sub-Saharan Africa with a production capacity of about 18 million tonnes per year.

The Nigerian deal will position Huaxin as sub-Saharan Africa’s second largest cement producer, but it will be up against a well-established local giant – Dangote Cement, the biggest in Africa, with a capacity of 52 million tonnes per year across 10 countries.

Huaxin, which is listed on the Shanghai Stock Exchange, says Nigeria “offers attractive growth perspectives” as its domestic market faces thin margins. The transaction is expected to conclude next year, subject to regulatory approvals.