Displaying items by tag: Canada

Canada: Christian Gagnon, the president and chief executive officer of McInnis Cement, has left the company. The board of directors announced the departure and said that the cement producer is currently recruiting his replacement. A new executive committee has been put in place to take over the management of the company until the vacancy has been filled. It is composed of the following members: Louis Laporte, Chief of Operations; Ronald Bougie, Executive Vice-President, Engineering, Construction and Operations; and Marc Baillargeon, Management Advisor acting on behalf of la Caisse.

In other changes to the company’s executive team, Ronald Bougie has been appointed with immediate effect as the Executive Vice-President, Engineering, Construction and Operations. Bougie has experience in the construction of large industrial projects including the Stornoway site, a project in which Caisse de dépôt et de placement du Québec invested. Until a new president and chief executive officer is appointed, Bougie will report directly to McInnis Cement’s Executive Committee. Bougie will have direct access to the Board of Directors to provide progress reports. The board will closely monitor the final stages of the site’s construction.

Canada: Alexandre Rail has been appointed as plant manager of McInnis Cement's Port-Daniel-Gascons plant in Gaspé. Rail brings with him 15 years of experience in heavy industry. He joins the company from ArcelorMittal, where he served as a Steel plant manager for seven years.

"We are pleased with our recruitment of an experienced manager in the heavy industry who shares our values in the areas of health and safety, environment and quality. Rail has proven abilities to mobilise employees," said Christian Gagnon, CEO of McInnis Cement. "Rail's family comes from Gaspé, so he is undoubtedly happy to relocate to that region and eager to contribute its local economic development."

McInnis Cement has also named Mark T Newhart as vice president of Logistics and Distribution and as a member of the company's management team. He will develop an efficient distribution network, with responsibility for transport management and marine terminals. Newhart will report to Jim Braselton, senior vice president of Commerical and Logistics.

"With his 30 years of experience in logistics, which includes 20 years in the cement industry, the addition of Mark to our management team is a major milestone," said Gagnon. "Since our business model is based on marine transportation of our products, Newhart's expertise in transportation and marine terminal management will be beneficial for our organisation."

With Newhart's appointment, McInnis Cement's management team is now complete. It comprises: Christian Gagnon as CEO; André Racine as senior vice president of Corporate Development and Legal Affairs; Jim Braselton as senior vice president of Commercial and Logistics; Gaétan Vézina as senior vice president of Operations; Claude Ferland as CFO; Mark T Newhart as vice president of Logistics and Distribution; Marc Lachapelle as senior director of Human Resources; Maryse Tremblay as director of Communications and Corporate Social Responsibility. McInnis Cement has also announced the relocation of its corporate office in downtown Montreal.

CRH has made good on its intentions. This week it stumped up Euro6.5bn to buy assets from Lafarge and Holcim in four continents. The move follows preparation since at least May 2014 when the Irish building materials group announced a divestment programme. In October 2014 it announced that it would sell its brickwork division.

CRH is finding the cash through a mix of existing cash, debt and equity placing. Interestingly, back in 2012 an Irish stockbroking analyst who was interviewed reckoned that the company could spend up to Euro3.5bn on acquisitions whilst remaining within its banking agreements. Throw in the recent sales and planned divestments and the planned acquisition from LafargeHolcim doesn't seem like too much of a stretch for CRH.

If completed, the purchase will see CRH take on 24 cement plants with a production capacity of 36Mt/yr. As a back of the envelope calculation suggests the sale price of Euro6.5bn isn't far off the occasionally used price of US$200/t for western cement production. The deal also includes aggregates, ready mixed concrete and asphalt assets.

The purchase marks a change in CRH's buying strategy both in terms of scale and distribution. Much of CRH's previous acquisitions have been minority shareholdings that make it difficult to accurately report the company's position in the cement industry. For example, in our Top 100 Report CRH was reported to have a production capacity of 6.49Mt/yr for majority shareholdings with another 19.9Mt/yr for minority shareholdings. The new cement capacity being purchased blows this away because it more than doubles CRH's total capacity and it appears to be all majority owned. CRH thinks that this will propel it to become the world's third biggest building materials manufacturer after LafargeHolcim and Saint-Gobain, leapfrogging Cemex and HeidelbergCement in the process. Strangely there is no mention of the huge Chinese players in the top five manufacturers in CRH's acquisition presentation.

CRH has avoided buying plants in southern Europe but it is relying on the slowly improving growing UK market, where CRH will pick up four plants, to balance the risk. Elsewhere in Europe, the three Holcim plants in France have been suffering from continued low construction rates in that country and the two Lafarge cement plants in Romania are unlikely to have recovered from a production fall in 2013. Outside of Europe growth has been poor in Quebec in 2013 and 2014, where CRH is buying two plants from Holcim. Both Lafarge and Holcim have also seen a slowdown in Brazil. However, the Philippines does seem like a better bet for CRH, with solid cement volumes growth seen by Lafarge in 2013 and the first three quarters of 2014.

With CRH now looking like a company that wants to produce cement rather than one that owns parts of companies that produce cement, all eyes are on the construction markets. 14 of the 24 cement plants CRH are buying are in Europe. Buying at the bottom of a sustained production slump makes sense because the asking price will be low. However, has the bottom been reached yet?

On 31 January 2014, the Québec government announced that it would invest US$350m in a new US$1bn, 2.2Mt/yr cement plant and port facility, to be operated by McInnis Cement at Port-Daniel. To say that this has prompted outrage in the industry is an understatement. Rival cement producers, including Lafarge and Ciments Québec have been unanimous in condemning the funding, which they see as an unjustified affront to fair competition in the province's cement industry. There was an angry response on the Global Cement LinkedIn Group, with dissatisfaction on a number of levels.

Firstly, established manufacturers highlight that the Québec cement market is in a slump, with 100-150 members of Métallos, the United Steelworkers union, currently on rolling temporary furloughs at any one time. There is over-capacity as it is. How will another cement plant help this situation? One contributor to the Global Cement LinkedIn Group said that the funding was like, "Taking the money I pay as taxes to break my legs." Another said, "Imagine our tax dollars heavily subsidising our direct competitor - totally unacceptable!"

Secondly, the government will have a direct interest in the cement industry, diverting public funds to a sector that (in the West) is traditionally left to its own devices. What does the government have to gain from this move? Well, there are suggestions that the awarding of future government cement and concrete contracts can no longer be fair due to the rather obvious conflict of interest. Could the government effectively award contracts to itself? Arguments from the government and McInnis that its distribution will be outside the areas served by the other plants don't seem to wash with the established producers.

Thirdly, there are fingers pointed at the Gaspasia paper mill project, a failed government-funded installation that was not established in the 1990s at a cost to the taxpayer of US$300m. It is unlikely that any of the parties involved would like to see a repeat at Port-Daniel.

Finally, the Canadian government appears to have turned its back on its own 'Wood First' policy, signed in April 2013, which stated that wood should be preferred in construction over cement and steel due to environmental concerns over embodied CO2. At the time Canadian cement manufacturers were at pains to point out that cement and concrete constructions were actually sustainable in comparison to many other building materials, especially with repect to long-term use and minimisation of energy consumed during a building's lifespan. At worst this seems to be a government U-turn but it could yet get more ugly. Now, with funding for new cement capacity, Québec appears to have 'listened' to the cement producers. How long before some cynics point to this change as evidence that the government wanted McInnis Cement to happen all along?

Whether a gross miscalculation or a deliberate ploy by the government, the McInnis Cement saga will not be going away. Ciments Québec and Lafarge will line up to fight the decision and, in litigation-heavy North America, this story could run and run.

Canada: René Thibault and Bob Cartmel have been appointed by the Lafarge Group as its senior leaders for all markets and product lines in Canada. Thibault will oversee the four western Provinces and three Territories as well as the Pacific north west and the Dakotas in the US. Cartmel will oversee the six Eastern Provinces.

Thibault has over 20 years of experience with Lafarge in Canada, which has included an assignment at the Lafarge group headquarters in Paris, France. He has an Engineering degree from Queen's University in Ontario and has completed executive studies at Harvard Business School in the US.

Cartmel has over 25 years of experience with Lafarge spanning Canada, the United States and Latin America. He has a Bachelor of Business Administration degree from Wilfrid Laurier University in Ontario.

Lafarge said that the appointments, which are part of its wider geographical restructuring programme to bring all of Lafarge's businesses together under a single leader in each geographical area, would provide further career development opportunities for employees, strengthen the company's customer approach as it delivers sustainable solutions to the construction industry and allow its community investment projects to be more focused.