Published: 29 April 2025

Khayah Cement, Zimbabwe's second-largest cement producer, is set to delist from the Zimbabwe Stock Exchange (ZSE) as part of a broader recovery plan aimed at reviving the troubled company outside the scrutiny of public markets.

The move follows a challenging two-year period for the company, which was acquired in 2022 by Fossil Mining from Swiss multinational Holcim in a US$29.7 million deal. At the time, Fossil hoped to leverage growing domestic demand for cement, but the venture was soon plagued by inherited financial burdens, deferred infrastructure maintenance, internal inefficiencies, and the impact of United States sanctions on Fossil itself.

In 2024, Khayah Cement entered into voluntary business rescue proceedings. Bulisa Mbano of Grant Thornton, who was appointed as the Corporate Rescue Practitioner, said that exiting the ZSE was now a necessary step for the company's survival.

"Delisting provides Khayah with the agility needed to execute time-sensitive actions such as cost-cutting and operational restructuring without being constrained by the continuous disclosure obligations of a public listing," Mbano said.

The company is carrying an inherited debt of US$11 million from its previous owner, Holcim. Mbano stressed that stepping away from the public market will make it easier to negotiate with creditors and implement turnaround strategies without the pressure of investor expectations or regulatory reporting deadlines.

Khayah Cement's planned delisting reflects a broader trend within Zimbabwe's capital markets, where an increasing number of industrial companies are retreating from public exchanges in favour of private solutions to financial distress and restructuring.

The company's physical and production assets are substantial but require significant revitalisation. Khayah operates a Vertical Cement Mill with an annual capacity of 700,000 tonnes, which remains operational. Two ball mills — Cement Mill 1 and 2 — are currently idle, though together they have an additional capacity of 450,000 tonnes per year. The plant's clinker kiln, with a monthly capacity of 26,000 tonnes, was overdue for major maintenance by three years when Fossil took control.

In addition to its core cement business, Khayah runs a Dry Mortar Division that produces tile adhesives, offering a capacity of 100,000 tonnes per year. The company also owns limestone quarries with an estimated mine life of 13 years and holds additional mining claims in Hurungwe and Mbubu, which could further extend its raw material resources.

The delisting is expected to take place in the coming months, pending approval by regulatory authorities. Khayah's management says the move is not a retreat, but rather a strategic reset that could ultimately pave the way for a more stable and competitive future.
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