Citadel’s ASEC Cement Enters Iraqi Market with a Consortium of Local Partners
A consortium of ASEC Cement, a portfolio company of ASEC Holding, and Iraq’s Qemmet El-Iraq has won a contract to rehabilitate and manage for 14 years the Muthanna Cement Plant in Muthanna Governorate, Iraq.
Representatives of the consortium — including Abulla Hussein of Qemmet El-Iraq as well as ASEC Cement Chairman and CEO Giorgio Bodo — attended a signing ceremony in Baghdad with Southern Cement Co., the state holding company that controls Muthanna Cement, on 28 August 2013.
The value of the contract was not disclosed.
“We are delighted to be entering this new market with a high-profile project that is economically vital to Iraq,” said Bodo. “Iraq has embarked on a robust plan to rebuild and modernize its infrastructure and has launched major housing, industrial, and community projects. The rehabilitation of Muthanna is an important part of Iraq’s investment in bridging the supply gap, particularly in the south.”
Muthanna Cement is one of seven plants controlled by Southern Cement Company. Built in the 1980s, the plant has a total design capacity of 1.92 MTPA clinker and 2 MTPA of cement. As a result of economic sanctions on Iraq in the 1990s, the company’s current production is c. 20% of its design capacity.
The consortium won the Muthanna contract following an international tender; work will begin in Q2 2014, with a view to reaching the full 2 MTPA production capacity by August 2016.
The Muthanna plant is located in southern Iraq, between Najaf and Basra.
Qemmet El-Iraq, ASEC Cement’s consortium partner, is headquartered in Erbil, Northern Iraq (Kurdistan). Established in 1989, it has a primary focus on manufacturing packaged food products with a national focus, among other activities. Qemmet El-Iraq’s shareholders have been active in the country’s construction and contracting industry since the late 1970s.
“ASEC Cement’s entry into the into the regionally important Iraqi market is part of Citadel Capital’s strategy of judiciously pursuing complimentary growth opportunities within our five core industries, including energy, agrifoods, transportation, mining and cement,” said Citadel Capital Chairman and Founder Ahmed Heikal.
ASEC Holding is Citadel Capital’s (CCAP.CA) platform company in the cement and construction sector.
The news of the Muthana consortium comes after subsidiary ASEC Minya started production of cement at its 2.0 MPTA plant in Minya. The US$ 360 million greenfield plant has implemented the most advanced technology in cement and clinker manufacturing and is in strict adherence with international environmental standards. ASEC Minya’s high-quality Portland Grey cement capitalizes on the abundance of limestone in the Minya governorate to serve the deficit market of Upper Egypt.
ASEC Minya is located 200 kilometers south of Cairo and 50 kilometers north of the city of Minya,
ASEC Cement presently controls c. 6.5 MTPA of total cement production in Egypt, Sudan and Algeria.
