Displaying items by tag: Takeover
Buzzi acquires full ownership of Companhia Nacional de Cimentos
07 October 2024Brazil: Buzzi has finalised the acquisition of the remaining 50% stake in Companhia Nacional de Cimentos (CNC) from Brennand Cimentos, securing full control over the joint venture. The deal, valued at US$311m, was approved by Brazil's Administrative Council for Economic Defense (CADE), according to Movimento Econômico. CNC has been operational since 2018 and has five integrated cement plants and two grinding plants in Brazil, with a total production capacity of 7.2Mt/yr. This acquisition follows initial transactions that began in June 2024.
Argentina: The sale of the cement plant Loma Negra by Argentine company to Brazilian firm Companhia Siderúrgica Nacional (CSN) will not proceed. The exclusivity term for negotiations expired on 12 July 2024 without an agreement, as stated in a communication to the Buenos Aires Stock Exchange by Loma Negra. It is now speculated that businessman Marcelo Mindlin may become a candidate to acquire the company.
Amsons Group bids US$180m for Bamburi Cement
11 July 2024Tanzania/Kenya: Tanzania-based Amsons Group has made a significant US$180m bid to acquire the entire stake of Kenya's Bamburi Cement. The group said on 11 July 2024 that it has made a binding offer with Bamburi Cement, according to The East African newspaper. The offer includes a premium of 44.4% over Bamburi's last closing share price.
Managing Director of Amsons Group, Edha Nahdi said "We have great plans to deepen our investment in Kenya and in Bamburi. Our offer to acquire shares in Bamburi is part of our corporate market expansion plan and will mark the formal entry of Amsons Group into the Kenyan market, where we plan to make investments in other industries in the coming months."
Boral backs Seven Group Holdings' raised takeover bid
12 April 2024Australia: Boral has endorsed Seven Group Holdings' (SGH) increased takeover offer after the bidder enhanced its proposal. According to Business News Western Australia, Boral is now recommending its shareholders accept SGH's offer, previously rejected in March 2024. The offer has risen from an initial US$0.98/share to a maximum of US$1.11/share. An on-market buyback is also an option at up to US$4.19/share, with total shareholder value estimated between US$4.02 and US$4.17.
Boral's independent corporate advisory company, Grant Samuel, now finds the offer ‘reasonable’. SGH has increased its stake in Boral to 78.8% and proposes further governance adjustments by adding two more executives to Boral's board.
Managing director of SGH, Ryan Stokes, said "We are pleased to offer Boral shareholders the maximum consideration under our offer. Both new and existing SGH shareholders also stand to benefit from the US$0.20/share fully franked dividend that SGH will pay following completion of the offer." The offer period is extended to 15 May 2024.
Boral's directors reject Seven Group takeover bid
22 March 2024Australia: Boral's independent directors have dismissed Seven Group's takeover bid, which valued the company at US$6.9bn. The directors argue the deal does not fairly or reasonably reflect Boral's value, especially considering its billion-dollar surplus property portfolio. Seven Group's offer of US$6.05 per share could potentially rise to US$6.25, but an independent expert from Grant Samuel has assessed Boral's fair value between US$4.24 and US$4.65 per share.
Seven Group's CEO, Ryan Stokes, said “We obviously disagree with their assessment strongly.”
Currently, Seven Group holds 71.6% of Boral and is offering a mix of cash and shares for the remaining stake, with potential incremental increases based on share acquisition levels and board recommendations.
Anthony Aboud, deputy head of equities at Perpetual, said "Our view is that Boral owns a unique and hard to replicate set of assets with an excellent management team led by Vik Bansal which is early on in its turnaround strategy."
A spokesperson for Boral said "We have carefully evaluated the Seven offer and recommend that shareholders should reject the Seven offer as it undervalues Boral. The independent expert has concluded that the Seven offer is neither fair nor reasonable, supporting the bid response committee's view. We encourage shareholders to remain with Boral and fully participate in the future value available through continued direct ownership of Boral."
Mexico: President Andrés Manuel López Obrador has accused the US government of funding environmentalists' challenges to the government's planned Tren Maya tourist railway project. AP News has reported that López Obrador has declared the project a matter of national security.
Cemex is currently embroiled in a dispute with Vulcan Materials subsidiary Sac-Tun over use of the latter's Punta Venado terminal in Quintana Roo. The terminal sits along the planned route of the Tren Maya line. The Mexican State Prosecutor's Office supported Cemex's re-entry into the terminal on 14 March 2023. The government previously rejected Sac-Tun's application to renew its quarrying licence for its quarry at the site of the terminal.
For more on this story, read our Global Cement Weekly analysis.
Seven Group takes control of Boral
16 July 2021Australia: Seven Group has increased its stake in Boral to 52% via a 3% equity swap with Macquarie. the company now has effective control of the building materials producer although it assured Boral that it would retain a majority of independent directors, according to the Sydney Morning Herald newspaper. However, Boral has continued to urge its shareholders to resist the ongoing offer by Seven Group to buy their shares. The takeover bid has been valued at around US$6.5bn. Boral is currently in the process of selling its US fly ash business.
Romania/Switzerland: Romania’s anti-trust authority has completed its review of LafargeHolcim’s takeover of the precast concrete manufacturer Someco for an undisclosed sum. SeeNews has reported that the body found that “no significant obstacles to effective competition” were raised by the deal.
Somaco’s five precast concrete and one aerated concrete block production plants, which employ 750 people, made sales of Euro56m in 2018.
Philippine Competition Commission proceeds to phase two of Holcim acquisition probe
09 September 2019Philippines: The 30-day inquiry by the Mergers and Acquisitions Office (MAO) of the Philippine Competition Commission (PCC) into First Stronghold Cement’s takeover of Holcim Philippines has concluded that the deal may affect market concentration in the cement sector. The Philippine Star reports that this finding clears the way for a phase-two review. The MAO will seek to ascertain whether the deal might result in lessened competition or increase the likelihood of cartel-like activities. This ties in with the Commission’s general investigation into anti-competitiveness in the cement industry.
First Stronghold Cement, a subsidiary of San Miguel, has a stake in Northern Cement and its president and chief operating officer, Ramón Ang, is also the majority owner and chairman of Eagle Cement. In May 2019 it acquired 85.7% of Holcim Philippines for US$2.15bn.
Germany’s Knauf announced this week that it is set to buy North American wallboard producer USG. The news is relevant for the cement industry because both companies are prominent gypsum producers. They are leading gypsum wallboard producers, with assets around the world, including gypsum mines. Although their focus is on wallboard a significant proportion of raw gypsum ends up being used in cement production. Hence, the takeover of a major North American producer by a European one deserves attention.
First a little background on the deal between Knauf and USG. The takeover has been a particularly acrimonious one at times, with both parties throwing strong language at each other and, although it has avoided being a hostile takeover, at times it seemed close. The deal became public in March 2018 when USG publicly said that it had rejected a bid of US$5.9bn from Knauf. It described the offer at the time as ‘wholly inadequate.’ Knauf then fought back by sending a letter to USG’s shareholders urging them to vote against director nominees at the next annual general meeting. Knauf owns 10.5% of USG’s shares. Then, in April 2018, Warren Buffett, the chief executive officer of Berkshire Hathaway, USG’s largest shareholder with a 31% stake, swung behind Knauf’s scheme. At this point it was revealed that Buffett had facilitated the initial talks between USG and Knauf. He even described the investment in USG as ‘disappointing.’ Buffett’s public move against USG in April 2018 signalled the death knell to USG’s independence. The US$7bn deal between Knauf and USG was agreed and announced on 11 June 2018. The transaction is expected to complete in early 2019.
USG operates 12 mines or quarries in North America. It also has other assets around the world including three gypsum mines in Oman, Thailand and Australia respectively that it runs in conjunction with its USG Boral joint venture in the Middle East and Asia. By contrast Knauf held over 60 quarries in 2014 with a focus on Europe.
The interesting implications from the merger may arise from what Knauf plans to do in certain regions. North America for example saw a reduction in raw mined gypsum production since the financial crash in 2008 as building markets suffered. Rising levels of synthetic gypsum production from coal power plants partly compensated for this. Buying USG gives Knauf a truly global base of natural gypsum production with which it can supply both itself and any cement customers. Knauf has a real shot of cornering the market in raw gypsum production provided it can keep the price low enough to stop enough rival mines being opened. Knauf might decide, as the construction market continues to recover in the US, to bring in the extra gypsum from elsewhere if it proved cost effective. Hooking up USG-Boral gypsum resources in Asia with Knauf’s might have implications for cement producing countries that lack sufficient gypsum supplies such as India. Oman is building itself up as the major gypsum exporter to Asia and USG-Boral is a part of it, with major gypsum resources in the country.
In terms of the cement industry it seems likely that there will be no immediate shakeup of gypsum supply. Long term supply contracts with either USG or Knauf should remain as they were and will stransfer to the new enlarged company. Knauf’s main market for gypsum is to use it to make wallboard but gypsum use for cement is a significant market as well. The ‘fun’ starts when or if Knauf starts to reorganise its supply chains. As its focus is on the wallboard business there may be implications thereafter for cement users. And since Knauf’s only major competitor at scale is Saint-Gobain, the market has just shrunk.