Portland Cement COO resigns after revelation of Lafarge payments

A Lafarge executive serving as chief operations officer of East African Portland Cement Company (EAPCC) has resigned, jolting the company’s succession plan just months before the exit of current CEO Kephar Tande whose second and final term ends in October.

Albert Sigei quit Wednesday after a nine-month stint at the partly State-owned cement company.

The exit of Mr Sigei — who was still entitled to benefits from Lafarge — comes a fortnight after a group of Kajiado politicians petitioned the Competition Authority of Kenya to probe the Paris-based multinational over allegations of anti-competitive behaviour and concentration of economic power at EAPCC.

Lafarge also owns a majority stake in Kenya’s biggest cement manufacturer, Bamburi.

“I wish to thank Mr Sigei for the service rendered to EAPCC and wish him all the best in the next phase of his career,” said Mr Tande in a statement.

Lafarge owns 41.7 per cent of East African Portland Cement, and also holds a controlling stake of 58.6 per cent at rival firm Bamburi Cement.

The Treasury owns 25 per cent of Portland and has traditionally teamed up with NSSF (27 per cent) to wield control over Kenya’s second-largest cement firm.

READ: Lafarge taken to competition watchdog over Portland

Mr Sigei joined EAPCC in August 2015 to help steer the loss-making company back to profitability, but the Athi River-based company has sunk deeper into losses and has already issued a profit warning for the current fiscal year ending in June.

EAPCC reported a net loss of Sh531 million for the half-year ended December 2015 compared to an after-tax loss of Sh65.3 million a year earlier.

“His results-oriented approach and strategic thinking ability will continue playing a pivotal role in helping EAPCC return to profitability,” said former CMC Motors boss Bill Lay who is chairman of EAPCC board.

Lafarge declined to reveal whether Mr Sigei will be going back to his previous role where he was vice-president of business support and ready mix operations at Lafarge Nigeria.

He was the number two principal at EAPCC overseeing production operations, production engineering, sales and marketing, procurement, research and development. The hiring of Mr Sigei saw EAPCC create a new chief operations officer position.

The company also signed a technical agreement with Lafarge to help turn around its fortunes.

Lafarge had planned to have Mr Sigei take over the reins at EAPCC come  November 16, 2016 when Mr Tande’s final three-year term lapses.

Dominance of the EAPCC board by Lafarge, sale of clinker — a key raw material — at high prices to the cement firm and Mr Sigei’s conflict of interest were the main points highlighted in the petition to the competition watchdog.

“While he remains entitled to some benefits from Lafarge, he is working full time for EAPCC and is not in any executive capacity within Lafarge,” disclosed Lafarge.