Benghazi-based AlModen Althman Holding Company, majority owned by Libyan Businessman Hatem El Sheikh is buying out the Australian majority owner in the Libyan Cement Company, in a deal which will give it control of the largest cement maker in North Africa.
The Austrian building materials firm Asamer bought into LCC when it was privatized in 2008 paying LD 200 million for a 50.6 percent share. The remaining equity was held by the Economic and Social Development Fund. Ten percent of the ESDF’s shares were supposed to be distributed to the workers.
Last year Asamer ran into financial troubles and some of its assets, including its shares in LCC, were transferred to a holding company for disposal. It is from this holding company, QuadraCir that AlModen Althman Holding Company is acquiring ownership at an undisclosed price in a deal which is likely to be sealed this Thursday.
LCC contributed to Asamer’s financial woes. It has three plants with 2,300 employees. Despite sending four aid convoys to its workers during the revolution, the management quickly ran into industrial unrest after Qaddafi’s defeat. Staff demanded to be paid LD33 million in wages for when the three plants, two in Benghzi and one outside Derna, were idle. A crippling strike and threat to 33 foreign employees forced Asamer to shut the plant.
Production was beginning to restart when violence returned to Benghazi. Both the factories in that city are in Hawari, one of the main centres of fighting against Ansar Al-Sharia. Neither is currently operational.
Hatem El Sheikh, the founder of AlModen Althman Holding Company, has said the deal is worth “tens of millions of dollars”. He added that it would also involve Libya Holdings investing millions more in upgrading production facilities.
Hatem El Sheikh told the Financial Times that he was not crazy to be investing at a time when Benghazi was still in parts a war zone and there are serious questions over the security of the Derna plant. “We have a long-term strategic plan” he said, “that Libya’s going to rebuild its infrastructure. And a key element of this is cement.”
Hatem El Sheikhs father maintained is powerful status in Libya even after Qaddafi came to power.
Hatem El Sheikh said that AlModen Althman Holding Company was being backed on the LCC deal by 15 investors from the Arabian peninsula, including Saudis, Kuwaitis and citizens of the UAE, as well some investors based in Europe.