Displaying items by tag: Italcementi

Italy: Italian cement maker Italcementi and Italian trade unions are looking for a solution for the temporary lay-off scheme that will expire in January 2016.

At a meeting on 15 October 2015, the parties determined that it is not possible to extend the current temporary lay-off scheme and consequently they are studying alternatives that would allow wider coverage compared to the initial programmes.

In a statement the trade unions explain that one of the hypotheses could entail the use of the scheme for total cessation of the activities at the plants in Monselice and Scafa, already suspended for years, as well as the partial cessation for the plants in Castrovillari, Sarche di Calavino and Salerno that could be concluded in January 2017.

Besides, a temporary lay-off scheme may be decided for the remaining group's employees that could last until September 2017. The parties will meet again on 2 November 2015.

Egypt: Talks between Suez Cement (SCGC) and Egyptian authorities are continuing to ensure the continued financial viability of the SCGC's Wind Farm project, according to Managing Director Bruno Carré.

The company, which is part of Italcementi Group, is currently holding discussions with the Egyptian government to reach specific terms that could help in reaching a solution. This would then help the company present the project to banks, which would provide financing for the project.

According to Carré, negotiations have been ongoing with the government since an Economic Summit that was held in March 2014 in Sharm El-Sheikh. "It's a complex issue and it's not moving as rapidly as we wanted," Carré said. He emphasised, however, that the slow progress is understandable, noting that, on the one hand, the Ministry of Electricity is proactive in ensuring the project happens, as it will help in electricity production. However, the ministry also has to bear in mind the economic balances, and will need to consider the Wind Farm project in relation to other projects, Carré added.

India: The Competition Commission of India (CCI) has approved German firm HeidelbergCement's proposed acquisition of Italcementi SpA in India. The CCI first announced this information in a tweet that said that it had approved of the 'acquisition of Italcementi SPA by Heidelberg Cement AG.'

China/Italy: Italcementi has sold its 5.24% stake in West China Cement for Euro39m. The price is subject to further adjustment, the group said in an announcement on 18 September 2015. Italcementi has sold the stake through its CimFra Limited subsidiary in China, and said the transaction would have no impact on earnings before interest, tax, depreciation and amortisation (EBITDA) generation capacity at group level.

Italy: Italcementi aims for 10% of its sales to be covered by innovative products in 2020, compared with 6.5% in 2014 and 1.5% in 2005, CEO Carlo Pesenti said during the conference for the presentation of biodynamic cement, which was used for the construction of the Expo 2015 building.

Germany/Italy: Italcementi's CEO Carlo Pesenti said that the acquisition of Italcementi by HeidelbergCement is expected to be completed in the first half of 2016, according to Dow Jones. September 2015 will be dedicated to speaking to European and national regulators to receive approval for the deal. Pesenti said that he will join the supervisory board of HeidelbergCement and plans to keep an active role in the company.

A member of the Global Cement LinkedIn group recently posed a question about the relative sizes of LafargeHolcim and Nigeria's Dangote Cement in the African cement market. The correspondent wanted to get a handle on their relative sizes and how the situation would change as a result of the merger. Would Dangote lose its position as Africa's number one producer? If so, would its aggressive expansion allow it to regain its position at the number one spot?

As both one of the most rapidly-growing markets in the world for cement and the one with the most potential for future gains, Africa has been discussed in this column on many previous occasions. However, we have previously considered Africa's different regional markets, be it Dangote-dominated West Africa, North Africa, rapidly-growing East Africa or the far south, where PPC is looking to counter Dangote's growing strength.

However, the formation of LafargeHolcim and the news that HeidelbergCement will acquire Italcementi (starting with an immediate 45% stake), has massively consolidated the African market. In conjunction with Dangote's rapid development, these deals have transformed the African cement sector from one with a large number of small national and regional markets into a far more homogeneous entity. A number of key players, namely LafargeHolcim, Dangote Cement, HeidelbergCement and PPC, are present in numerous important markets all over the continent.

In answer to the aforementioned LinkedIn group member, the Global Cement Lafarge-Holcim Merger Report, states that LafargeHolcim controls 47.1Mt/yr of capacity in Africa. The new group is present in markets as diverse as Egypt, Morocco, Nigeria, South Africa and Zimbabwe. It is currently Africa's largest cement producer.

The second-largest producer at the moment is Dangote Cement, the only African-based large multinational cement producer. According to its website, it has 31.2Mt/yr of capacity currently active in Africa. The group is rapidly expanding. "We hope to commission four other cement plants in Senegal, South Africa, Cameroon and Tanzania before the end of 2015," said Aiko Dangote, Dangote Group President this week.

The new Dangote capacity that we can identify adds 4Mt/yr. This takes Dangote's total to 35.2Mt/yr. This is close to the 37.1Mt/yr of African capacity that LafargeHolcim actually owns, but Dangote is always planning its next move. Indeed this week it was rumoured to have been looking at purchasing Italcementi itself, hence HeidelbergCement's rapid movement.

In its press-release, HeidelbergCement suggests that the purchase of Italcementi will give it a position as strong as Dangote in the African market at around 30Mt/yr. It will add strong positions in Morocco and Egypt to its existing strengths on the West African coast. For its part, South Africa-based PPC currently has around 8Mt/yr of capacity in South Africa (4Mt/yr), Botswana, Zimbabwe and Ethiopia. It is currently installing capacity in the Democratic Republic of Congo and as far afield as Algeria, where it is involved in a joint venture with a local group.

Between them, these 'Big Four' share approximately 116Mt/yr of capacity in Africa. According to the Global Cement Directory 2015, this is just over half of Africa's 225Mt/yr of cement production capacity. This proportion will only increase as Dangote and PPC enlarge their presences.

The multinational players will likely not expand as rapidly, even in Africa. At the launch of LafargeHolcim, Group CEO Eric Olsen was pretty clear that the company does not plan any 'capital-intensive' expansions in the coming years. HeidelbergCement's future actions are less predictable, especially as we are yet to hear about any divestments that may be required from HeidelbergCement and Italcementi in order to satisfy competition authorities around the world.

Whatever happens in the future, it is clear that the African cement industry has undergone a significant transformation in the past few weeks. With per-capita cement consumption far lower than on other continents, there will be plenty of room for growth as well as for more acquisitions, divestments, mergers and expansion projects from the 'Big Four' and others in the coming years.

Italy: HeidelbergCement rushed to buy control of Italcementi after fears that Nigeria's Dangote Cement also showed interest in the Italian cement maker, according to PM News. It has been reported that Dangote did not make a formal offer for Italcementi.

Carl Franklin, head of investor relations at Dangote, said that the company did not comment on specific rumours, but said that "As a large company we examine all options for growth." HeidelbergCement has not commented on whether it had faced competition from Dangote.
According to unnamed sources, the talks between HeidelbergCement and Italcementi began four months ago.

Italcementi chief executive Carlo Pesenti told local media that the deal was 'bulletproof' and there was no space for counter offers. The only outstanding condition was clearance from antitrust authorities. "If it wasn't for the antitrust approval, the shares would have already changed hands," said an unnamed source.

Having already agreed to acquire a 45% stake of Italcementi, HeidelbergCement plans to obtain as many of the remaining shares as possible in the upcoming mandatory buy-out offer, then squeeze out the remaining shareholders and make Italcementi privately-owned.

Italy: Italcementi has reported a profit of Euro3.8m in the first half of 2015 compared to a loss of Euro79m in the same period of 2014. Its revenue rose by 6% to Euro2.17bn, while earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 5% to Euro324m. The company expects a slight improvement in operating results in the entirety of 2015.

Italy: The takeover by HeidelbergCement of Italcementi 'represents a form of military occupation,' according to political party Northern League leader Matteo Salvini on 29 July 2015.

In an interview with the League's radio station Padania Salvini, which is strongly opposed to European integration and the common currency, Salvini said that the HeidlebergCement purchase fit with the wider strategy of what he suggested was a 'German-led Eurozone takeover of Italy.'

"What the Germans were not able to do with tanks and with the Brownshirts, they're now able to do thanks to Soviet Europe," said Salvini during the radio call-in programme. "If these were free choices by free-market entrepreneurs, there would be no question. If they are chosen as constricted subsidiaries, in a Europe with a currency assembled to help the Germans, then they are part of a strategy of military occupation."