Displaying items by tag: Brazil
Brazil: The Conselho Administrativo de Defesa Econômica (CADE) has approved, with conditions, the merger of Holcim and Lafarge in Brazil. CADE has stated that the companies would have to sell 31% of their installed capacity. The plants to go are based in the States of Minas Gerais (Pouso Alegre, Arcos, Matozinhos, Santa Luzia) and Rio de Janeiro (Cantagalo, Santa Cruz), which have a total of 3Mt/yr of cement production capacity.
Brazil: Colombia's Cementos Argos has decided not to 'do battle' for cement-sector assets in Brazil that currently belong to the European giants Lafarge and Holcim. The Colombian multinational has informed the Superintendencia Financiera that it does not see such a purchase as being likely to generate the value its investments would expect.
Thus, Argos puts an end to three months of expectation regarding a possible debut in Brazil for the company. The assets in Brazil's Sudeste region are up for grabs so that the merger can meet with anti-monopoly requirements and amount to some US$1bn. Argos had been in consultation with local financial giant Itau concerning a possible bid. The Colombian cement group's foreign eye will most likely focus now on Mexico, another nation mentioned fondly by company president Jorge Mario Velasquez.
India/Brazil: UltraTech Cement is re-evaluating its decision to bid for the Brazilian assets of Holcim SA, according to local media. The Aditya Birla group company had submitted non-binding bids for the cement assets in October 2014. Any binding bids are due in January 2015.
The Brazilian assets on sale include three integrated cement plants and two grinding stations that share a total capacity of 3.6Mt/yr. There is also one ready-mix plant. Now, rather than investing in those assets, the UltraTech plans to focus and expand its domestic cement production, according to local media, but an UltraTech spokeswoman said that company does not comment on market speculation.
The decision to re-think the Brazilian investment may stem from weak demand conditions in the market. The Brazilian economy has seen sub 2% growth in the last 11 quarters. For the three months ending 30 September 2014, the Brazilian economy actually contracted by 0.24%.
Brazil: Holcim and Lafarge are actively negotiating an agreement with Brazil's anti-trust council, Conselho Administrativo de Defesa Econômica (Cade), to gain approval for their merger.
The deal involves divestitures of 31% or 3.6Mt/yr of Lafarge and Holcim's joint cement production capacity in Brazil. The assets could be sold to single company or several bidders. Holcim is still bound to pay Cade a US$197m fine that was imposed due to cartel practices. Lafarge paid US$16.7m to Cade in 2007 to end the investigation into its practices.
Egypt/Brazil: Egypt's Arabian Cement has entered a joint venture for a cement grinding plant with Brazil's Cementos La Union. The project is worth US$28.8m.
Arabian Cement's board of directors approved the venture with Cementos Relampago, an affiliate of Cementos La Union, 'to establish a cement grinding plant in Northwest Brazil with a total capacity of 230,000t/yr.' The US$28.8m investment cost will be financed 50% through debt and equity. Arabian Cement's contribution would be US$8.76m, representing 60% of the total paid-in capital.
Brazil: Provale, a manufacturer of calcium carbonate, plans to enter the well and white cement markets. It is setting up a 190,000t/yr capacity cement grinding plant at Cachoeiro de Itapemirim, Esprito Santo. Provale is currently waiting for environmental clearance to start ground breaking in a 50,000m2 area. US$4m of the project funding is coming from the US private equity company, Resource Capital Funds, which has bought a 22% stake in Provale. President Emilio Nemer Neto said that talks with a prospective partner in Europe for the acquisition of clinker are underway.
India/Brazil: UltraTech Cement, India's largest cement producer, intends to bid for assets owned by Lafarge in the south-eastern region of Brazil, according to Indian press. If the bid is successful it will be the company's largest overseas deal to date. The Aditya Birla Group company currently holds small assets in west Asia.
The Brazilian assets on sale include three integrated cement plants and two grinding stations with a total capacity of 3.6Mt/yr, as well as one ready-mix plant. The Lafarge assets are on sale as part of the divestment plant following the announcement of the LafargeHolcim merger.
UltraTech has an installed cement production capacity of 62Mt/yr. It has 12 integrated plants, one clinker plant, 16 grinding units and six bulk terminals with operations across India, United Arab Emirates, Bahrain, Bangladesh and Sri Lanka.
Colombia: Directors at Cementos Argos have given the green light for an ordinary bond issuance of up to US$495m to be used as working capital and to swap financial liabilities. The company will have three years to carry out the issuance, although it will most likely do so in the coming months.
Previous issuances by Cementos Argos, such as those carried out in 2012 to raise US$495m, have helped the firm expand in Colombia, Latin America and the United States. Argos revealed in August 2014 that it is considering buying Holcim and Lafarge assets in the region, particularly Mexico and Brazil, and has announced that it will also build a US$450m plant.
Ireland: Ireland-based building materials group CRH will sell its clay brickwork division for up to Euro760m in order to bid for cement assets that are to be sold as part of the LafargeHolcim mega-merger. London-based sources have said that the Dublin-based company had hired bankers from JP Morgan to find a buyer for the division.
CRH is believed to be interested in all of the assets Lafarge and Holcim have up for sale, including subsidiaries in Canada and Brazil. LafargeTarmac, the largest cement maker in the neighbouring UK, is also up for sale as part of the LafargeHolcim divestment package. There are Euro5bn of assets for sale in total.
The disposal could be one of the first big changes by CRH's new chief executive, Albert Manifold. He was promoted in January 2014 after the retirement of Myles Lee, who had spent 32 years at the company. Several private equity firms are thought to be interested in the clay brick division. Bankers said that it was likely to fetch Euro630-760m.
Brazil/UK: Lafarge Tarmac, the UK's largest cement firm, may be bought by the Latin American conglomerate Votorantim. The mooted deal comes as giant cement firms Lafarge of France and Holcim of Switzerland sell off assets as they pursue their merger, announced in April 2014.