Pretoria Portland Cement (PPC) has bought three aggregate quarries from Quarries of Botswana for 50 million pula (R55.07m).

The acquisitions are part of the listed cement and lime producer’s strategy to expand its footprint in Southern Africa and build its aggregates division into the largest producer in Botswana.

PPC said last year that low cement demand in South Africa since 2007 and increased competition in the local market had resulted in it developing a strategy to move into other “much more exciting markets” in sub-Saharan Africa.

PPC chief executive Paul Stuiver said at the time these markets included Mozambique, Zambia, Angola, the Democratic Republic of Congo, Tanzania, Kenya and Uganda, which had not yet reached the level of infrastructure development evident in South Africa.

Stuiver said in May this year that PPC anticipated making an announcement about at least one sub-Saharan project before the end of this year in line with its stated strategy of expanding into continental markets outside South Africa.

Riaan Redelinghuys, PPC’s executive for the aggregates division, said yesterday that the quarries it had acquired in Gaborone, Francistown and Selebi-Phikwe would expand its existing portfolio in Botswana to meet the local market demand for aggregates, a complementary product to cement.

The investment would lift the total annual capacity of PPC’s aggregates division to 4 million tons from 3 million tons and increase its workforce by about 100, he said.

“Both Gaborone and Francistown are forecast to be major growth nodes and this was an obvious choice to develop our aggregates business further. Acquiring the assets of an existing business made more sense than embarking on a green fields expansion.”

Prior to this acquisition, PPC’s aggregates division owned two large quarries in Gauteng and in Gaborone.

The aggregates division supplies construction aggregates to the civil construction sector and mineral products to the chemical, metallurgical and agricultural industries.

Stuiver said PPC had communicated to its investors that the company was pursuing expansion opportunities in other parts of Africa but this acquisition showed it was still considering any good opportunities.

The company reported last month that earnings a share and headline earnings a share in the year to September were expected to be between 25 percent and 30 percent lower than the previous year, citing rising input costs and an inability to recover costs through price increases despite higher cement demand for the lower earnings.

PPC added that a successful price increase during July would enhance revenues in August as well as last month but the overall pricing environment was expected to remain competitive.

The company’s stock declined 1.3 percent yesterday to close at R23.10