Last week’s news that Germany’s HeidelbergCement is considering adding production capacity in SA has sparked speculation that the world’s third-biggest cement group could be eying PPC.
Supply continues to outpace demand in SA as Nigerian-and Chinese-backed companies enter the market and French giant Lafarge looks to further grow its presence. Since oversupply is likely to remain for some time, an industry insider asks whether HeidelbergCement might be looking to buy an existing player rather than add new plants.
PPC is in talks to merge with smaller rival AfriSam to build scale and weather an increasingly competitive environment.
The companies are tiny relative to HeidelbergCement, which has an annual capacity of more than 120-million tonnes.
PPC can produce 8-million tonnes a year, but is growing capacity to 14-million tonnes.
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