Athi River Mining Ltd. (ARML), Kenya’s second-biggest cement maker by market value, rose to a three- week high after the company secured a $50 million convertible loan to fund expansion plans in east and southern Africa.

The stock climbed 0.6 percent to 162 shillings by the 3 p.m. close in Nairobi, its strongest level since March 8.

Africa Finance Corp., a Nigeria-based development-finance institution, is providing a $50 million convertible loan to Athi River, which translates to 13.62 percent of the company’s equity if converted, Athi said on March 27. Plans to increase annual production capacity to 2.6 million tons a year by 2013 will bring output to 1 million tons in Kenya, 1.5 million tons in Tanzania and 100,000 tons in Rwanda, the company said. It didn’t give its current capacity.

“The debt is mainly for expansion plans in the region to complete ongoing projects and to expand a clinker plant in Tanzania,” Vimal Parmer, head of research at Kestrel Capital East Africa Ltd., said by phone from Nairobi today. “We are expecting good cash flows from these operations especially in Tanzania.”

To contact the reporter on this story: Sarah McGregor in Nairobi at smcgregor5@bloomberg.net

To contact the editor responsible for this story: Sarah McGregor at smcgregor5@bloomberg.net