Displaying items by tag: GCW158

Europe: Lafarge and Holcim have set up a Divestment Committee following the announcement of the planned merger on 7 April 2014, with the aim of taking forward the divestment process. The Committee has drawn up a list of proposed asset disposals to anticipate potential competition authorities' requirements. The announcement represents a major part of the total assets that the two companies aim to divest.

The two companies are proposing the following disposals:

• Austria: Lafarge's Mannersdorf cement plant;

• France: Holcim's assets in metropolitan France, except for its Altkirch cement plant and aggregates and ready-mix sites in the Haut-Rhin market; Lafarge's assets on Reunion island; except for its shareholding in Ciments de Bourbon;

• Germany: Lafarge's assets;

• Hungary: Holcim's assets;

• Romania: Lafarge's assets;

• Serbia: Holcim's assets;

• UK: Lafarge Tarmac assets with the possible exception of one cement plant.

• Canada: Holcim's assets;

• Mauritius: Holcim's assets;

• The Philippines: the associated companies of Lafarge and Holcim (Lafarge Republic Inc and Holcim Philippines Inc) are exploring the combination of their businesses other than LRI's Bulacan, Norzagaray and Iligan plants, which are considered to be divested as part of such combination;

• Brazil: Holcim and Lafarge will file soon with the Brazilian regulator (CADE) and propose a comprehensive and high quality package of divestments.

The future LafargeHolcim group will have a significant and balanced industrial base in Europe, enabling it to take advantage of the European economic recovery. Both companies will continue to consider whether divestments would be necessary where there might be overlaps or depending on regulatory requirements.

The proposed divestments are subject to review and further discussions with the regulatory authorities. The divestment process will be carried out in the framework of the relevant social processes and ongoing dialogue with the employee representatives' bodies and will be conducted in parallel to discussions with the competition authorities and potential buyers. The divestment process will be completed subject to the closing of the merger between Holcim and Lafarge.

Find out exactly which cement plants are affected by Holcim and Lafarge's proposed asset divestments in the Global Cement Directory 2014, available here.

Ghana: Cement prices may soar in the coming weeks as manufacturers are faced with challenges hindering supply flow. Dangote Cement has suspended its imports to Ghana because of the fast depreciating Ghana Cedi, while Diamond Cement is reported to be facing challenges in importing clinker to manufacture cement in Ghana.

France: Italcementi has reached the ownership threshold allowing for a squeeze-out of its French arm Ciments Français SA after a share purchase. With the latest acquisition of some 1.2m shares of Ciments Français, Italcementi has surpassed 95% of the share capital of the unit, while it had already secured 95% of the voting rights of the company in June 2014.

Italcementi's buyout bid for Ciments Français, which commenced on 13 June 2014, is worth Euro79.50/share, excluding dividend. Italcementi unveiled the final price of the offer for Ciments Français on 20 May 2014. It said at the time that it held 83.83% of the share capital and 91.03% of the voting rights of the unit and that its bid had a maximum total counter-value of some Euro464m.

Italcementi announced that it would initiate a squeeze-out procedure for the rest of the shares of Ciments Français at the offer price within three months from the completion of the bid. The move would be followed by the delisting of Ciments Français from NYSE-Euronext Paris.

Update: Italcementi has announced that the squeeze-out procedure for its French arm, Ciments Français, will commence on 15 July 2014 at a price of Euro79.50/share (net of all costs).

Currently Italcementi holds 97.73% of the share capital and 98.65% of the voting rights of Ciments Français and it intends to purchase the remaining 2.27% stake from minority shareholders. As agreed with the Autorité des Marchés Financiers (AMF) and in accordance with market practices, trading of Ciments Français shares have been suspended.

Belgium: Cembureau, the European cement association, believes that the European Commission's proposed headline resource efficiency target fails to capture real resource efficiency improvements by adopting the weight-based Raw Material Consumption (RMC) as a proxy.

While the cement industry is raw-material intensive by mass, it is also one of the biggest contributors to the circular economy. Cembureau believes that in order to enhance resource efficiency in the cement industry, the following factors should be ensured:

• When applying the waste hierarchy (prevention, re-use, recycling, recovery, disposal), options that deliver the best overall environmental, social and economic outcomes should be encouraged and assessed at the local level;
• Efficient use of resources throughout the value chain spanning from extraction, manufacturing, construction, use, to end-of-life stages;
• Use of resources in such a way that has the lowest environmental, social and economic burdens over the long term;
• Use of resources appropriate to the reserves available, i.e. scarcity/abundance are critical factors, which mean sustainability needs to be approached in different ways for different resources.

India: CK Birla group's subsidiary, HIL Limited, has announced that it has sold 100,000t of Charminar brand fibre cement roofing sheets in May 2014.

"This is the highest ever achieved by any brand globally," said HIL's managing director, Abhaya Shankar. He added that Charminar has been a household name, synonymous with asbestos roofing solutions across India, for nearly six decades. HIL has eight manufacturing plants, an installed capacity of 1Mt/yr and a 20% share in the US$669m market of asbestos roofing products in India.

Formerly known as Hyderabad Industries Limited, HIL launched Charminar asbestos roofing products 66 years ago. Shankar said the brand had attained market leadership some time in the late 1950s and retained that position thereafter. As a part of brand-building efforts, HIL has deployed campaign vans, relied on wall paintings and actively participated in village marts and other such events in rural areas. According to Shankar, the brand building involved three aspects: a strong relationship with distributors, a pan-Indian presence and consistent policies in respect of trade. HIL has also made use of a good supply chain and a robust system to get customer feedback. HIL spends about 2.5-3% of its revenues on brand building.

China: Anhui Conch Cement Co Ltd expects net profit for the first half of 2014 to increase by 90%, up from US$493m during the same period of 2013. Anhui Conch attributes the upward trend in profit to increasing cement sales and prices.

Kenya: Kenya's ARM Cement has completed the acquisition of Rwanda's Kigali Cement as it continues expanding its East African market.

ARM, which has held a 35% stake in the only privately-owned cement company in Rwanda since 2011, Kigali Cement, bought out the remaining 65% stake held by various shareholders to take complete control of the firm. The deal was finalised in April 2014. Kigali Cement, which had US$1.9m in net assets in 2013, has a cement production capacity of 100,000t/yr, which is expected to increase with further ARM investments.

"We finally acquired a 100% equity stake and full control of our Rwanda grinding plant," said ARM's chairman, Rick Ashley. He added that ARM also plans to increase its capacity and market share using its flagship brand, Rhino Cement.

The value of the deal was not disclosed, but it is estimated to cost over US$1.2m based on Kigali Cement's net asset value. The purchase will be financed by banks, according to Pradeep Paunrana, ARM's chief executive.

The acquisition is part of ARM's expansion plans, which seeks to improve sales in Rwanda and neighbouring markets. ARM will leverage on its new acquisition to expand its production and distribution network in East Africa. Ashley said that ARM will seek further measures to increase its market presence in Kenya, East Africa's largest economy, as well as Rwanda and Tanzania, completing ongoing projects and focusing on new markets in the region.

ARM is expected to commission Tanzania's Tanga plant, which holds a production capacity of 1.2Mt/yr of cement, in the fourth quarter of 2014. It will also start construction of its US$300m Kitui plant in Kenya in October 2014.