Displaying items by tag: Acquisition

One surprise at the end of August 2024 was that Türkiye-based Çimsa has agreed to buy a majority stake in Ireland-based Mannok. The subsidiary of Sabancı Holding signed a deal to acquire just under a 95% stake in Mannok Holdings based on an enterprise value of Euro330m for 100% of the shares. The final purchase price will be determined later in the process, as will a potential completion date subject to the usual regulatory approvals.

Çimsa has described the deal as its “third major global initiative in the past three years” following expansions in the US and Spain. Çimsa started production at its 0.3Mt/yr white cement grinding plant in Houston, Texas in 2019. It is currently planning to set-up a 0.6Mt/yr grey cement grinding plant, also in Houston, with operation expected to start by the end of 2024. Its Spain-based business received a boost in mid-2021 when it purchased the Buñol white cement plant in Valencia from Cemex. Outside of Türkiye the company also operates a few terminals in Germany and Italy. Of interest to this article it established a subsidiary for sales in the UK in mid-2023.

Mannok was previously known as Quinn Group before it was rebranded in 2020. In addition to cement the company sells a range of construction products including PIR (polyisocyanurate) insulation, aircrete thermal blocks, roof tiles and precast concrete. The company is headquartered at Derrylin in Fermanagh, Northern Ireland in the UK but it operates in both Ireland and the UK. It runs a 1.4Mt/yr integrated plant at Ballyconnell, County Cavan in Ireland, just across the border from Derrylin. With the 17th Global CemFuels Conference scheduled to take place next week in Dublin, it is worth noting that this cement plant had a recent upgrade of interest to the alternative fuels sector. In 2023 the company said that it had installed the world’s first FLSmidth Fuelflex Pyrolyzer at a cement plant following an earlier pilot of the system back in 2018. It is used to replace coal with solid recovered fuels (SRF) in the pre-calcination stage of cement production. Later in 2023 Mannok said that the equipment was reducing its CO₂ emissions by 58,000t/yr.

As reported in the October 2023 issue of Global Cement Magazine, cement from the Ballyconnell plant is sold in both Ireland and the UK. In 2022, 35% of its sales were in Ireland, 30% in Northern Ireland and the remaining 35% in the rest of the UK. The company uses a storage unit at Warrenport in Northern Ireland to despatch cement to a 8400t cement storage and distribution at Rochester in Southern England.

Çimsa said that the acquisition is intended to help it to increase the share of its revenue in foreign currencies to over 70%. It is not a revelation that Çimsa might want to do this given the parlous state of the economy in Türkiye since 2018. Interest rates are high and the Turkish Lira has lost value. Çimsa raised the issues this has caused in its 2023 annual report. These include higher costs for imported goods and services such as energy, equipment and engineering services. In 2023 the company reported that 57% of its sales consisted of foreign currency-based revenue. The same year exports represented just under 40% of the company’s total revenue. Overall, Çimsa’s revenue fell slightly year-on-year in 2023, in part due to the divestment of a cement plant and other assets, but earnings rose significantly.

Buying Mannok gives Çimsa another route into the European Union (EU), via Ireland, and the UK. Crucially, this gives its first integrated grey cement production site outside of Türkiye. Both of these things are especially useful for an export-focused company facing increasing hurdles to sales in the guise of the EU Emissions Trading Scheme. It also helps the business to further hedge against negative currency exchange effects back home in Türkiye. So ‘Sláinte’ to Çimsa and Mannok, and good luck.

The 17th Global CemFuels Conference & Exhibition takes place in Dublin, Ireland on 18 - 19 September 2024

Ukraine: The Antimonopoly Committee of Ukraine (AMCU) has approved CRH Ukraine's acquisition of over 50% of the voting shares in Dyckerhoff Cement Ukraine. This move is part of a broader agreement that includes anti-competitive measures to be implemented within 24 months post-transaction. CRH Ukraine will acquire a 99.9775% stake in Dyckerhoff, with expectations for the European Bank for Reconstruction and Development to potentially join as an investor following a mandate signed in December 2023. 

Germany: Cemex has acquired a majority stake in the Berlin-based recycling company RC-Baustoffe to enhance its circularity business Regenera. The company processes construction, demolition and excavation materials. The acquisition integrates RC-Baustoffe with Regenera, allowing the facility to process up to 400,000t/yr, which will be turned into repurposed aggregates for concrete production.

CEO of Cemex, Fernando González, said “With acquisitions such as this, Cemex continues to strengthen its commitment to circularity through Regenera as well as promoting the world’s transition to a more circular economy. Construction and demolition materials account for more than 30% of global ‘waste’ streams and reintegrating these materials into the construction value chain can reduce the use of virgin raw materials."

India: Dalmia Bharat announced that its subsidiary, Dalmia Cement (Bharat), has entered into a share subscription and shareholders agreement to acquire a 26% stake in Truere Surya for US$5.3m. Truere Surya will establish a solar power project in Tamil Nadu, aligning with Dalmia Bharat’s goals to become carbon negative by 2040.

The solar project will have a capacity of 128MW. Completion of the transaction is anticipated within 4 - 6 months, pending customary conditions.

Germany: Switzerland-based ABB has acquired analytics equipment supplier Födisch Gruppe. ABB says that the acquisition will enhance its offering of continuous emission monitoring systems and expand its technology and innovation competitiveness.

Stephan Schumann, CEO of Födisch Group’s parent company Dr. Födisch Umweltmesstechnik, said “This acquisition is a testimony of our strong performance in recent years. Leveraging ABB’s global footprint will allow to scale the impact of our offering internationally.”

ABB’s Measurement and Analytics President Jacques Mulbert said “We are very impressed by what the Födisch Gruppe has achieved and are eager to welcome their team to the ABB family. Integrating the Födisch Gruppe into ABB will unlock significant opportunities for new and existing customers.”

Ireland: Sabancı Holding subsidiary Çimsa Çimento has signed a share purchase agreement to acquire a 95% stake in Mannok. Reuters has reported the total enterprise value of Mannok as €330m. In determining the eventual purchase price, Çimsa Çimento says that it will make adjustments for any debt or related items. The deal marks the group’s entry into Ireland and the UK, where Mannok also distributes cement.

Mannok chair Adrian Barden said "Çimsa and the broader Sabancı group are a superb fit for Mannok as new long-term strategic owners, with excellent sustainability credentials and know-how. The group is steeped in cement manufacture and building products and, as a diverse conglomerate, it also has interests in retail and food, important sectors for our packaging business. We are very pleased that Sabancı has endorsed the Mannok brand and has agreed to back local management's plans to accelerate our sustainability and growth ambitions.”

Çimsa Çimento CEO Umut Zenar said "We believe this agreement marks the beginning of a new era for Mannok. At Çimsa, our model is to back great local businesses and management, and we look forward to creating new employment opportunities in the region as we support Mannok's continuing growth and sustainability ambitions. Given its border location, Mannok has unique access to UK and EU markets, and we see it as a key stepping stone in expanding our footprint in Western Europe. For Mannok staff, joining the Sabancı ecosystem will also present a world of opportunity for career development and progression and exposure to innovation in product development, sustainability and digitisation."

India: Ambuja Cement has announced the completion of its acquisition of Penna Cement Industries Limited, acquiring a 100% stake in the company. The deal, first approved by Ambuja’s Board of Directors on 13 June 2024, has effectively made PCIL a subsidiary of Ambuja Cement from 17 August 2024. The company did not provide further details on the operational or financial impacts of this acquisition.

Ukraine: CRH Ukraine has announced plans to purchase a 99.9775% stake in Dyckerhoff Cement Ukraine, which operates two cement plants in the Rivne and Mykolayiv regions, according to Business World Magazine. The notification was made public on 12 August 2024, detailing the acquisition of over 158 million shares. Currently, CRH and its affiliates do not hold any shares in Dyckerhoff Cement Ukraine.

Philippines: Cemex has received approval from the Philippine Competition Commission (PCC) to sell 90% of Cemex Holdings Philippines's shares. The approval relates to a joint acquisition by DMCI Holdings, Semirara Mining and Power and Dacon of shares in Cemex Asian South East Corporation, which holds a major stake in Cemex Holdings Philippines. This clearance is a requirement for finalising the transaction, contingent on further compliance by the acquiring companies.

Peru: Switzerland-based Holcim has acquired ready-mix concrete producer Mixercon and industrial minerals producer Comacsa for US$100m. Comacsa owns a white cement plant in Lima. Noticias Financieras News has reported that the acquisitions mark Holcim’s entry into Peru, strengthening its hold in the South and Central American market.

Regional head Oliver Osswald said "The incorporation of Comacsa and Mixercon will allow us to generate synergies and develop export markets.”