Displaying items by tag: Singapore

Singapore: Jurong Port has ordered three Siwertell ship unloaders from Bruks Siwertell to handle cement imports. The port’s cement terminal already has three Siwertell ship unloaders that have been used for over 20 years. Two of these will be replaced as part of the upgrade project.

The three new ST 490-M screw-type rail-travelling unloaders will each discharge cement, fly ash and cement slag from vessels up to 50,000dwt at a continuous rated capacity of 800t/hr. Two of the new unloaders are scheduled for delivery in May 2022 and the third by the end of 2022. All will be fully assembled prior to delivery and transported by heavy-lift ship. Final commissioning and performance tests will be carried out in Jurong Port.

Vietnam: ThyssenKrupp Industrial Solutions has announced the relocation of its Asia Pacific cement regional division headquarters to Hanoi from Singapore. The new headquarters are on the site of one of the company’s “largest cement plant engineering centres.” It retains offices in Singapore, Indonesia, Thailand and the Philippines. The main motivation for the move is to better enable ThyssenKrupp to supply Vietnamese cement producers.

Cement technologies chief executive officer (CEO) Pablo Hofelich said, “In our new headquarters, we bring together experts from Germany, Singapore and Thailand to support the Vietnam office. Vietnam is the largest market in terms of cement production capacity in a dynamic and growing Asia Pacific.” Asia Pacific cement business CEO Lukas Schoeneck said, “We are focusing on know-how transfer and the development of solutions that are tailored to the requirements of the local markets in Asia Pacific. Besides, we will expand our service activities to strengthen our local footprint and proximity to clients. Lastly, we will push sustainable technologies within our Grey2Green initiative.”

Malaysia: Singapore-based Hong Leong Asia subsidiary HL Cement Malaysia has acquired an 88% stake in Tasek Corporation. Hong Leong Asia subsidiary Ridge Star has acquired the remaining 12% minority stake. MarketLine News has reported the total value of the deal as US$19.4m.

Philippines: LafargeHolcim’s sale of its 86% stake in Holcim Philippines to San Miguel Corporation for US$2.15bn has fallen through after the Philippines Competition Authority (PCC) failed to approve the deal within 12 months of its conclusion. Reuters News has reported that the agreement, dated 10 May 2020, covered the exchange of four integrated plants and one grinding plant. LafargeHolcim has been divesting assets to pay off debt. The sale of its Holcim Philippines stake would have completed its withdrawal from the South-East Asia market, where its operations across Indonesia, Malaysia, Singapore and the Philippines had been valued at US$4.90bn.

LafargeHolcim has said that three of its four integrated Philippines cement plants have been able to resume operations following the lockdown due to the coronavirus outbreak. It says that it will ‘focus on strengthening operations in the Philippines.’

No overarching theme this week but rather four changes of note in different markets. The first is Lehigh Hanson’s agreement to buy the integrated Bath plant in Pennsylvania, US, from Giant Cement, a subsidiary of Mexico’s Elementia. Lehigh Hanson, a subsidiary of Germany’s HeidelbergCement, plans to pay US$151m for the 1.1Mt/yr unit giving it a cost of US$137/t of cement capacity. That’s a similar price that Elementia paid when it acquired Giant Cement in 2016. The Mexican conglomerate paid US$220m for a 55% stake in 2016 for three cement plants with a combined production capacity of 2.8Mt/yr or US$143/t.

The purchase by HeidelbergCement draws a line following problems selling its business activities in Ukraine. The group blamed a drop in profit in the first half of 2019 on this. Since then though it has been linked to a takeover of UltraTech’s stake in Emirates Cement, the owner of the 0.5Mt/yr Emirates grinding plant in Dhaka, Bangladesh. Buying a cement plant in North America, its second most lucrative region after Western and Southern Europe, looks set to be a wise investment.

The timing here is interesting given that Elementia, the building materials company partly-owned by ‘Mexico’s richest man,’ Carlos Slim, has been steadily expanding in recent years. As stated above it only acquired Giant Cement in 2016. However, its net sales and earnings fell in the second quarter of 2019 caused by a market contraction in Mexico affecting all of its businesses. Sales from its cement businesses in the US and Central America grew but they fell by 6% at home in Mexico. Elementia said that proceeds from the sale of the Bath plant will be used for debt repayment and ‘general’ corporate purposes. Notably, Ricardo Naya Barba, the president of Cemex Mexico, has also described the local market as ‘difficult’ this week, in comments reported upon by local media.

Meanwhile in Africa, China’s Huaxin Cement purchased Maweni Limestone from Athi River Mining (ARM) Cement in Tanzania as part of the latter’s on-going administration process. Local press reported the transaction as costing US$116m and subject to regulatory approval. This one’s interesting because it shows a major Chinese cement producer buying related assets outside of China. This is likely part of the country’s Belt and Road Initiative to develop industry and infrastructure around the world and to give its overproducing industries new markets. Perhaps the surprise here is that Huaxin Cement hasn’t gone after the rest of Kenya’s ARM Cement… yet.

The other African news story of note this week was the confirmation that Singapore’s International Cement Group (ICG)’s intended purchase of Schwenk Namibia had failed. This deal was announced in March 2019 but it later ran into trouble when the Singapore Exchange blocked the proposed acquisition in June 2019 on the grounds that ICG didn’t appear to have the money to pay for it.

Lastly, Yamama Cement announced that it wants to sell its Production Lines 1-5, which have a daily clinker production capacity of 5600t/day. The producer previously temporarily shut down the lines in 2017 and it has been planning to build a new cement plant. Since then though it has faced shrinking sales and profits in the tough Saudi Arabian market.

The takeaway from all of this is that, despite the doom and gloom of a world producing too much clinker, some cement companies are targeting growth in specific territories. Sometimes these schemes succeed, as in the case of HeidelbergCement and Huaxin Cement, and sometimes they don’t, as ICG has found out. Heavy building materials like cement are costly to move around so a plant or assets in the right place at the right time can make a fortune.

Namibia: Singapore’s International Cement Group (ICG)’s intended purchase of Schwenk Namibia for US$104m has fallen through. The company stated that it will not buy the subsidiary of Germany’s Schwenk Zement, whose 1.0Mt/yr total integrated capacity consists of Ohorongo Cement’s Walvis Bay plant, over four months ahead of the deal’s long stop date of 31 January 2020. The deal’s deadline had previously been extended from 30 June 2019 following the Singapore Exchange forestalled the deal due to ICG’s inability to pay for the unprofitable company.

Singapore/Namibia: International Cement Group (ICG) has extended the stop date of its agreement to buy Schwenk Namibia by six months to 31 January 2020. It follows the decision by the Singapore Exchange to block the proposed acquisition in June 2019 on the grounds that it did not meet the requirements for a ‘very substantial acquisition.’ ICG announced in March 2019 that it had arranged to buy a 100% stake in Schwenk Namibia for US$104m. Schwenk Namibia owns a 69.8% share of Ohorongo Cement.

Singapore: The Singapore Exchange has blocked the International Cement Group’s (ICG) proposed acquisition of Schwenk Namibia. It said that the transaction did not meet the requirements of a very substantial acquisition (VSA) because the target business was not profitable and because the buyer did not have sufficient cash resources to fund the purchase.

In order to approve the acquisition in the future the exchange requires: that ICG commissions implement anti-money laundering measures on any potential funds for the transaction; that it put into place ‘adequate’ internal controls and risk management systems for any of its operations in Kazakhstan, Tajikistan, Namibia and any other developing country; and that the audit committee uses external auditors.

ICG announced in March 2019 that it had arranged to buy a 100% stake in Schwenk Namibia for US$104m. Schwenk Namibia owns a 69.8% share of Ohorongo Cement.

Europe/Singapore: ZAG International has appointed Daniel Ulestig as Managing Director, Head of Global Shipping and European Business operation. He will have responsibility for all of ZAG’s shipping activities around the world as well as leading the company’s business interests in Europe.

Ulestig started his career as a trainee at Holcim Trading in Madrid, Spain in 1998. In 2003, he joined Belden Shipping as a market analysts and moved to Singapore in early 2004 later becoming its Commercial Director. Belden Shipping was subsequently acquired by Kristian Gerhard Jebsen Skipsrederi of Bergen, Norway in late 2006. In 2008, Ulestig was named Assistant Vice President of KGJC Cement (Singapore), with responsibility for all chartering activities east of the Suez. In 2010, he assumed oversight of the Singapore office and was named to the entity’s board of directors in 2011. In 2014, Ulestig was made Vice President of KGJ Cement in Singapore. He moved back to Sweden in late 2017 where he continued to serve as KGJ Cement’s Vice President Chartering.

Malaysia/Singapore: Switzerland’s LafargeHolcim has signed a deal to sell its 51% stake in Lafarge Malaysia to YTL Cement for US$396m. Lafarge Malaysia operates three integrated cement and two grinding plants. With the divestment, LafargeHolcim will fully exit the Malaysian market. LafargeHolcim has also signed an agreement with YTL Cement Singapore for the divestment of its entire 91% share in Holcim Singapore.

YTL Cement is part of YTL Corporation, a Malaysian infrastructure conglomerate, which is active in cement production, construction, property development and utilities. The deal is expected to be completed within the second quarter of 2019. It is subject to approval by regulatory bodies.