Kabira Akoob, CSI Manager at PPC
Kabira Akoob, CSI Manager at PPC

Bloomberg -  PPC Ltd.’s largest shareholder is supporting a joint offer for South Africa’s biggest cement maker from domestic rival AfriSam Group Pty and Canadian insurer Fairfax Financial Holdings as the tie-up would create a national champion, according to people familiar with the matter.

The Public Investment, Africa’s biggest money manager, sees the three-way deal as a way for an enlarged cement maker to expand more effectively on the continent, said two ofthe people, who asked not to be identified as the PIC’s position is private. The manager of South African state-worker pension
funds also sees significant cost savings from the combination, the people said. PPC’s board will consider all offers equally, in the best interest of shareholders, a spokeswoman said in emailed comments.

A spokesperson for the PIC didn’t immediately comment. AfriSam didn’t immediately respond to an emailed request for comment. Fairfax didn’t answer a call placed outside office hours.

Read also: R2 billion bid for PPC stake but based on AfriSam merger

The PIC first indicated its support for a merger between PPC and AfriSam in a letter last month, before Fairfax entered  the talks. Its continued backing will come as a boost to the two potential buyers as they prepare for a possible challenge from rival bidders.

Nigeria ’s Dangote Cement Plc, controlled by Africa ’s richest person, Aliko Dangote, is among those considering a counteroffer, people familiar with the matter said last week. LafargeHolcim Ltd., the world’s biggest cement maker, is also monitoring PPC’s situation, they said.

The PIC owns about 11 percent of PPC, according to data compiled by Bloomberg. It’s also the biggest shareholder in AfriSam with about 60 percent.