Displaying items by tag: LafargeHolcim
Syria: LafargeHolcim has dodged accusations by La Monde that Lafarge entered into deals with armed groups in Syria, including Islamic State (IS), to protect its business interests in the country. In a statement LafargeHolcim said that its first priority was the safety and security of its employees at its Jalabiyeh cement plant before it eventually closed the plant. It did not deny the accusations.
Le Monde reported it had seen letters sent by Lafarge managers in Syria revealing arrangements that Lafarge made with the jihadist group to continue production until 19 September 2014 and to arrange access for staff and supplies. The French newspaper also alleges that Lafarge bought licences from and paid taxes to IS middle-men and oil traders.
Lafarge operated the 3Mt/yr Jalabiyeh cement plant from 2010 to 2014. In September 2014, Lafarge stopped operating the plant. After that, all employees were evacuated, put on paid leave and were no longer allowed to access the plant. In December 2014 Lafarge decided to terminate all employee contracts, and where possible, transfer employees to other parts of the group.
Australia: Adelaide Brighton says it has prepared for an acquisition of the operations of LafargeHolcim in Australia and New Zealand. Chief executive Martin Brydon confirmed the plans to The Australian newspaper. He added that the plan includes measures to cope with competition issues that could arise from the takeover. However, Brydon admitted that LafargeHolcim has not declared if it is actually selling its assets in the region.
European Bank for Reconstruction and Development to increase stake in Holcim Azerbaijan cement factory to 20%
22 June 2016Azerbaijan: The European Bank for Reconstruction and Development (EBRD) plans to increase its stake in Holcim Azerbaijan to 20% from 10%.
"The EBRD is considering an additional investment in Holcim OJSC to increase the bank's stake in the company, with a view to extend its participation in the business," the EBRD said in a statement. The bank intends to support the company’s energy efficiency through the use of alternative fuels. On 20 July 2016 the EBRD board of directors will start a preliminary review of the issue of increasing the stake in Holcim Azerbaijan.
Holcim Azerbaijan produces 35 - 40% of Azerbaijan's cement and clinker. The company's main shareholders are LafargeHolcim (66%), EBRD (10%) and Holcim Auslandbeteiligungs GmbH (10%).
Sri Lanka: The Industry and Commerce Ministry has expressed its interest in buying the local operations of LafargeHolcim. Government sources have said that discussions are now on-going within the administration. The multinational cement producer announced in early June 2016 that it was selling its subsidiary Holcim Lanka. The company was originally state-owned before it was privatised.
"The government is willing to negotiate to buy it at a reasonable price. This is the only integrated cement plant in Sri Lanka. The limestone quarry in Puttalam belongs to the Cement Corporation and it had been leased out to Holcim," said a spokesman of the ministry quoted by the Daily News newspaper. He added that no final decision on the matter has been taken yet. The government also hopes that, if it successfully purchased the company, it could reduce the price of cement in the country.
Local press reports that seven bidders have made offers for Holcim Lanka. These include companies from UAE, Indonesia, Thailand, China and Sri Lanka. Holcim Lanka’s assets include two packing plants in Galle and Trincomalee, a cement plant in Puttalam and a cement grinding plant in Galle.
LafargeHolcim to sell assets in nine more countries
14 June 2016Switzerland: LafargeHolcim plans to sell assets in nine additional countries as part of its post-merger divestment programme, according to the Financial Times. The announcement follows a portfolio review. However, LafargeHolcim did not name the locations of the proposed sales. In March 2016 the group released details of sales in South Korea and Saudi Arabia and plans to merge its operations in Morocco. This followed plans to generate Euro3.16bn from divestments in 2016.
Holcim Romania extends its range of bagged cements
14 June 2016Romania: Holcim Romania has extended its range of bagged cements to better address the needs of the local market. Its new bagged range comprises: Structo Plus 40 kg, Structo Plus 20kg, Structo 40kg, Extra Dur 52 40kg and Tenco 40kg. They have been chosen to meet customer demands for aesthetics, shorter setting time, lower costs, higher strength and durability.
“The new range of cement bags is the best proof of how Holcim Romania understands and contributes for the development of the construction sector, by implementing and offering innovation and sustainability in the market through tailored and cost-effective solutions,” said Sofiane Benmaghnia, CEO Holcim Romania.
Report highlights risks to cement producers from future emissions costs and water use constraints
09 June 2016World: A new report released by the Carbon Disclosure Project (CDP) has highlighted the potential costs of future CO2 emissions and water supply constraints for 12 of the top global cement producers. CDP’s research shows that, even at a US$10/t CO2 price, US$4.5bn could be wiped off profits, with the least efficient companies most at risk.
By compiling questionnaire responses, the report ranks 12 cement producers for performance across five key areas – emissions, energy and material management, carbon cost exposure, water resilience and carbon regulation supportiveness. It found that LafargeHolcim, Shree Cement and CRH were the least CO2- and resource-intensive producers, with Italcementi, Cementir and Taiheiyo Cement the most highly intensive. Several major Chinese and other regional players failed to respond.
CDP found that many of the major cement companies have emissions targets that are set to expire in the next few years. It argues that, with the Paris Agreement driving towards net zero emissions by the middle of the century, cement companies have a ‘historic opportunity to set targets that can ‘future-proof’ their businesses.’
Tarek Soliman, Senior Analyst, Investor Research at CDP said, “This is the first piece of major research to break down how major players in the cement industry are meeting the challenge of reducing emissions in line with the science called for by the Paris Agreement. Cement will be a crucial building block as the Paris Agreement is put into effect, as it accounts for 5% of the world’s man-made emissions. The results couldn’t be clearer for companies and investors: a tipping point for cement companies is not far away.”
“As carbon-related regulatory measures inevitably tighten and the carbon price signal strengthens, investors will expect both strategic and rapid changes from cement companies, including better use of currently available options as well as investment in longer–term ones, whether this be in areas such as low-carbon product development or the deployment of carbon capture, use and storage.”
All change in Sri Lanka?
08 June 2016When a small cement market sits just off the coast of one of the world’s biggest producers, it’s not a recipe for a lot of column inches. Sri Lanka’s cement market, is particularly small, ranked 128th out of 141 clinker producing nations according to the Global Cement Top 100 Report 2015, and is dwarfed by a very dominant neighbour in India. Therefore, when two stories about plant projects and divestments came in from Sri Lanka this week, our interest was suitably piqued.
The first story came from global giant LafargeHolcim, which announced the planned divestment of its 0.6Mt/yr integrated Holcim Lanka plant at Puttalam, its 1.0Mt/yr grinding plant in Galle and associated packing facilities. The second story came from South Korea’s AFKO Group GMEX (AFKO), which has expressed strong intentions to reopen the Kankesanthurai plant in the north of the country.
LafargeHolcim stated that its move was part of its wider divestment strategy following the 2015 merger of Lafarge and Holcim. Considering that the company currently controls 1.6Mt/yr of Sri Lanka’s 3.6Mt/yr cement capacity (around 44%) the potential ramifications are big - A huge position is up for grabs.
Local newspaper The Nation stated that three locally-owned groups were already circling the assets as of Saturday 4 June 2016, but it’s still early days. A major player could easily step in to grab some high-quality assets in this rapidly-growing market, which grew by 4.5% in 2014 and is investing strongly in infrastructure. With its recent history or major purchases, CRH could certainly be interested. Larger Indian and Pakistani players, stifled by continued overcapacity at home, could also be in line to snap up the assets.
Up in the north, the AFKO project sounds massive. It could also have large implications for the shape of the Sri Lankan cement sector but there is a lot of work to be done. The Kankesanthurai plant produced its last cement in 1991 as the civil war raged in the north of Sri Lanka. It had a capacity of just 0.12Mt/yr at that time. However, AFKO chairman Keun Young Lee stated that the company was, “Ready to enter with US$450m as a start.” This is far more than the amount needed to re-start a small, presumably wet process cement plant. The amount strongly suggests an entire new, state-of-the-art facility, but no capacity has been announced.
AFKO sounds very serious but other projects have previously run into trouble on the island. A restart at Kankesanthurai has previously been mooted twice, once by a domestic player and once by a company from the UAE. Meanwhile Thatta Cement has suspended construction of a US$15m, 0.1Mt/yr grinding plant at Rajapaksa, Hambantota. It will be very interesting to see how the AFKO project develops over the coming months – It will also be seeing how the eventual price-tag for the project compares with the revenue that LafargeHolcim raises from its own divestment.
While Sri Lanka remains a small player, its cement sector is very similar to that of India when we take populations into account. Both have room for expansion. India has 310Mt/yr (according to the Global Cement Directory 2016) but, with a population of over 1.25 billion, it has a per-capita capacity of around 250kg/capita. Sri Lanka, with 3.6Mt/yr of capacity and 20.2 million inhabitants, comes in at just under 200kg/capita. There is clearly room for growth in both of these figures and further projects could yet be on the horizon for Sri Lanka. If they play their cards right, AFKO and the successful bidder for the LafargeHolcim assets could be in a great position to benefit from the island’s strong continued growth.
Algeria: CILAS, a joint operation between Lafarge Algeria (49% stake) and Souakri Group (51% stake) located in the northeast of the country, has started commissioned its mill at its Biskra cement plant. Operation of the site’s kiln is scheduled to start in July 2016 according to the El Watan newspaper.
China’s CBM, a subsidiairy of Sinoma, signed a deal to build the plant in mid-2014. The engineering, procurement and construction (EPC) contract included design, equipment supply, civil construction, installation, training and commissioning of the project. The plant will have a cement production capacity of 2.7Mt/yr when fully operational.
LafargeHolcim to leave cement business in Sri Lanka
03 June 2016Sri Lanka: LafargeHolcim is exiting its cement business in Sri Lanka, according to the EconomyNext financial news service. A spokesperson said the decision to sell its subsidiary Holcim Lanka was part of a larger global divestment strategy. The company operates the country’s only integrated cement plant, a cement grinding plant and a bagging plant.