A deal was sealed between Messebo Cement Factory Plc, a Singaporean firm, Kusto Group Pte and Fairfax Africa Fund to establish a new factory MKF Building Materials Production Plc. The partnership will be investing over USD 70 million.
The company that is to be set up will be 60 percent majority owned by Messebo while Kusto and Fairfax own 40 percent.
The agreement was signed on Thursday, January 04, 2018 between Azeb Mesfin, CEO of EFFORT (Endowment Fund for the Rehabilitation of Tigray), Zemedneh Nigatu, chairman of Fairfax and Hayder Gulam, general legal counsel of Kusto.
“I am hoping it will be a fruitful company since it is the first of its kind in Ethiopia and I also hope that it will not only supply the local market but also export the products to East Africa,” Azeb said during the signing ceremony.
It was also stated that MKF’s products such as roofing materials, will be used in residential housing as well as commercial real-estate and industrial buildings and will be sold in domestic and regional African market. The products will utilize the latest technology in corrosion prevention, thermal conductivity and sound reduction and will have useful lives of more than 50 years.
It was further stated that MKF will help reduce Ethiopia’s reliance of imports of certain types of building materials since it will be manufacturing the products with very high local value addition including locally sourced raw material.
“Investment in infrastructure are rapidly transforming the economic landscapes across Africa, especially in Ethiopia, one of the fastest growing economies in the world. That is why we decided to invest in MKF together with Messebo and Kusto. MKF will introduce global best practices in manufacturing and distribution and positively enhances the country’s economic transformation by creating hundreds of jobs, generating exports and saving hard currency through quality import substitutions,” said Zemedeneh Negatu, Chairman of Fairfax Africa Fund.
The factory is said to be located around Mekelle and Abi Adi in Tigray and production is expected to start within a year.