ASEC Cement Completes Zahana Overhaul in Algeria, Confirms Minya Plant to Enter Commissioning Phase by Year’s End

The leading regional cement company has begun work on a new raw mill that will expand capacity at the recently overhauled Zahana plant in Algeria and expects full production from the Arab National Cement Company in Minya to begin by the first quarter of 2013, creating 400 direct jobs

Citadel Capital (CCAP.CA on the Egyptian Exchange), the leading private equity firm in the Middle East and Africa with US$ 9.5 billion in investments under control, announced today that a key subsidiary of portfolio company ASEC Cement has completed a significant overhaul.

“Zahana Cement Company, our key Algerian subsidiary, has just concluded the largest overhaul in the plant’s long history,” noted ASEC Cement CEO Giorgio Bodo. “This substantial intervention will lead to a 20% year-on-year increase in the production of both clinker and cement. Moreover, the deployment of new bag filters as part of the upgrade has dramatically lessened the plant’s environmental footprint.”

Following the overhaul, Zahana’s production capacity is rated at c.900,000 tons of clinker per annum.

ASEC Cement has management control and a 35% equity stake at Zahana in partnership with the Government of Algeria.

ASEC Cement has also begun work on a US$ 30 million project to construct a new raw mill at Zahana that will be fully operational by 2014, raising Zahana’s production capacity to c.1.2 MPTA of clinker. Moreover, procedures have already started to launch a new line of 1.5 MTPA. This further expansion should be completed by 2015, allowing the plant to reach 2.7 MPTA of clinker and 3.0 MPTA of cement.

Zahana, located in western Algeria 40 kilometers from Wahran, had a production of 650,000 tons of cement in 2008 when ASEC Cement took over management of the company..

The changes in the plant in the last few years have been very important not only in terms of production and profitability; they have also reduced the plant’s environmental impact and substantially improved the employee working conditions.

Meanwhile, ASEC Cement confirmed today that it is on track to start commissioning at the Arab National Cement Company (ANCC), its 1.9 MPTA clinker greenfield plant in the Upper Egyptian governorate of Minya, in the final months of 2012.

ASEC Cement is the largest shareholder in ANCC with a 45% stake in the project and expects to bring the US$ 335 million plant into production in the first quarter of 2013.

Civil works on site were complete at year-end 2011. In a bid to accelerate construction following delays related to the events of 2011, ANCC and ARESCO — the contractor
responsible for the steel fabrication and mechanical erection of the plant and an ASEC Holding portfolio company — are now implementing a recovery plan to complete mechanical and steel installation by the third quarter of this year.

“Moreover, we have concluded a contract to connect ANCC to the national electrical grid, and works are now underway on a 42-kilometer transmission line that will connect the plant to the Samalloot power station. ANCC has also secured the natural gas connection and water supply for the project, and infrastructure work is in progress,” Bodo said.

ANCC is on record as being one of Egypt’s biggest project finance deals. In September 2010 ANCC signed an EGP 1.1 billion loan to finance the construction of its plant in Minya. The syndicated loan agreement involves a consortium of seven leading Egyptian and regional banks, which will cover 52% of the US$ 335 million investment with the balance financed by the equity of ANCC.

Other shareholders in ANCC include Misr Qena Cement (13.9%), Safari Investments (30.7%), IFU/FLS (9.2%) and other shareholders (1.1%).

ASEC Cement is a portfolio company of ASEC Holding, Citadel Capital’s platform company in the regional construction, engineering and cement industries. ASEC Cement will control total production of 10 MTPA of cement by 2015.

ANCC’s Minya project will create 400 direct and 1,500 indirect jobs — including indirect jobs created during the course of construction.

—Ends—

Citadel Capital (CCAP.CA on the Egyptian Stock Exchange) is the leading private equity firm in the Middle East and Africa. Citadel Capital focuses on building regional platforms in select industries through acquisitions, turnarounds, and greenfields executed via Opportunity-Specific Funds. The firm’s 19 OSFs now control Platform Companies with investments of more than US$ 9.5 billion in 15 countries spanning 15 industries, including mining, cement, transportation, food and energy. Since 2004, Citadel Capital has generated more than US$ 2.2 billion in cash returns to its co-investors and shareholders (on investments of US$ 650 million), more than any other private equity firm in the region. Citadel Capital is the largest private equity firm in Africa by PE assets under management (2007-2012, as ranked by Private Equity International). For more information, please visit www.citadelcapital.com.

For more information, please contact:

Ms. Ghada Hammouda
Head of Corporate Communications
Citadel Capital (S.A.E.)

g...@qalaaholdings.com (click to reveal this email)

Tel: +20 2 2791-4439 
Fax: +20 22 791-4448
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