Displaying items by tag: China
Anhui Conch to double West China Cement stake in consolidation
30 November 2015China: Anhui Conch has agreed to more than double its stake in smaller rival West China Cement for US$592m amid consolidation in an industry suffering from overcapacity.
Conch International Holdings (HK) Ltd, a wholly owned unit of Anhui Conch, plans to increase its holding in Shaanxi-based West China to 51.57% from the current 21.17%. If the transaction goes through, Anhui Conch will make a mandatory cash offer for all of the shares of West China that it doesn't already own.
West China agreed to buy four units of Anhui Conch and will issue shares in itself to pay for the purchase. West China will issue 3.403 billion shares at US$0.17 each for a total of US$592m. The issuance will raise Anhui Conch's stake in West China. Should Anhui Conch be required to make an offer for the rest of West China, it will pay US$0.22 in cash for each share.
Claudius Peters' ETA Cooler exceeds 13,000t/day in China
17 November 2015China: The ETA Cooler, the concept for cooling clinker in the cement making process announced by Claudius Peters Projects GmbH in 2004, has reached a new capacity milestone with a more than 13,000t/day model going into production earlier in 2015 in China.
The ETA Cooler principle was introduced in 2004 with a 2000t/day installation at a Holcim cement plant in Switzerland. Over the last decade, Claudius Peters Projects has progressively offered the market increasingly higher capacity models. It has now reached 13,000t/day, currently the world's highest capacity cement line production. The company has said that even higher capacity is feasible.
Due to its design, no dust removal system is required with ETA Cooler and the relatively long stroke action means a low grate speed, which in turn means less wear and maintenance. As there are no obstructions to the clinker flow in this moving floor technology, high transport efficiency is also achieved, with uniform cooling, thus improving the quality of the clinker and in turn the quality of cement produced, according to Claudius Peters Projects. The ETA Cooler has a very low construction profile and modular design, allowing it to be retrofit to existing cement plants.
China: China's Ministry of Industry and Information Technology (MIIT) has unveiled a document to ask cement companies in north China to carry out peak-shifting production on a trial basis in the winter. The peak-shifting production will not only ease the 'haze weather,' but also enhance the cement market and reduce producers' costs, according to industry insiders.
Due to fierce market competition, cement enterprises in north China produce cement at full capacity in the winter to seize the opportunity when the energy supplies end and building operations start. However, in the summer, many enterprises are forced to produce at half of their installed capacity due to the glut of cement on the market. As the cement industry is a high energy-consumption industry, the overlap of cement production and energy supply in winter increases coal consumption and leads to haze weather in north China. If peak production were carried out in winter for four months, about 4.36Mt of coal and 177bnm3 of flue gas emissions would be cut in the whole northern area, which could help improve the local environment. The peak-shifting production could also help ease overcapacity.
After the peak-shifting, cement enterprises in north and northeast China will suspend production for four to five months in winter and the overcapacity rate in the domestic cement industry will fall to 16 – 21% from the current 51%, which would help enhance the industrial climate.
Tianrui Group will help fix Shanshui debt if EGM vote passes
13 November 2015China: The largest shareholder in Shanshui Cement, Tianrui Group, has said that it could help solve the debt woes of Shanshui Cement, if it is successful in a bid to change the company's board at an extraordinary general meeting on 25 November 2015, according to Bloomberg.
Shanshui, which is at the centre of a shareholder scrap for control, failed to pay US$314m of onshore notes due on 12 November 2015. It is at least the sixth Chinese company to default in the local bond market in 2015 as borrowers struggle amid an economic slowdown. Shanshui, which is incorporated in the Cayman Islands, has decided to file a winding up petition and seek the appointment of provisional liquidators there. Two banks have asked for early repayment of Shanshui's loans and the default scare has spread to the asset-backed securities market.
Li Heping, Vice Chairman of Tianrui, said that Shanshui's filing for a winding-up petition has raised potential costs for his company because it now faces finding a debt solution. Tianrui, which holds 28% of Shanshui, would get 'nothing in return' from its stake if it didn't help, he said. China National Building Material Company and Asia Cement Corporation are also shareholders in Shanshui with 16.7% and 20.9%, respectively.
Shanshui's Chief Financial Officer Henry Li said that noteholders could try and get their money back by asking the court to liquidate Shanshui's assets, which would be the worst outcome. In addition to the US$314m that Shanshui failed to repay, the company has another US$800m onshore notes outstanding, according to Bloomberg-compiled data.
China: Shanshui Cement has decided to apply for provisional liquidation after determining that it will default on onshore debt payments due on 12 November 2015, a sign that Chinese authorities have become willing to allow weak firms to fail, according to Reuters.
The privately-owned company had been struggling to raise funds as its operations have been hit by overcapacity in the sector. "It's a sign that bailouts are not for everybody and that the slowing economy is taking its toll on the non-investment grade sector," said Warut Promboon, Chief Rating Officer at Dagong Global Credit Rating.
Shanshui Cement said that the petition would constitute a default for US$500m in bonds due in 2020 and trigger an accelerated repayment clause. Its shares have been suspended from trading since April 2015.
Conch delegates visit Eurocement
10 November 2015Russia/China: A delegation from Conch company, one of China's largest building materials corporations, has visited Russia to see the cement plants of Eurocement. At the meeting, which was held at Eurocement's central office, the group's president Mikhail Skorokhod explained the group's key projects to the Chinese representatives and discussed possible areas of cooperation.
"Conch has the most modern equipment for the production of cement and has considerable experience in operating production lines. It is extremely interesting for Eurocement to study its experience as well as to consider its foreign experience for the development of the national building materials industry in Russia," said Skorokhod. "I am convinced that our Chinese colleagues would also be interested in getting acquainted with the activities of the Russian cement sector leader. This meeting will be the beginning of a fruitful and mutually beneficial cooperation."
The Chinese delegation will visit Mikhailovcement, Ulyanovskecement and Sengleevskiycement during the visit.
West China Cement to buy Yaowangshan Cement for US$121m
02 November 2015China: West China Cement has agreed to acquire the entire equity interest of Tongchuan Yaowangshan Ecological Cement Co Ltd as well as shareholder's loan of US$121m. The Yaowangshan cement plant in Yaowangshan, Tongchuan, Shaanxi has 2.2Mt/yr of cement production capacity.
China Conch Venture and Red Day Limited, which is owned by West China Cement's Non-executive Director Ma Zhaoyang, agreed to inject US$14.2m and US$4.73m into Xi'an Yaobai Environmental Technology Engineering Co Ltd. Upon completion, Yaobai Environmental will be 60% owned by Conch Venture, 20% by Red Day and 20% by West China Cement.
West China Cement expects to record a US$63,096 loss as a result of the transactions. The parties agreed to develop Yaobai Environmental into the only platform for the treatment of dangerous and hazardous waste for the parties within China. West China Cement believes that the investments from Conch Venture and Red Day, which will provide additional financial resources to Yaobai Environmental, is an important step towards this goal and paves the way for further collaboration among the parties.
China: Anhui Conch Cement's operating profit fell by 31% year-on-year to US$1.1bn in the first nine months of 2015 as weak demand and price competition took a toll. Its revenue dropped by 13% to US$5.96bn.
Chinese demand for cement has languished following a rush of infrastructure building. Domestic cement production shrank by about 5% year-on-year to roughly 1.7Bnt during the first nine months of 2015, according to the National Bureau of Statistics.
China: China Resources Cement's profit attributable to owners for the nine months that ended on 30 September 2015 fell by 60.6% year-on-year to US$165m. Sales fell by 15.5% year-on-year to US$2.55bn. The decline was mainly attributable to lower sales prices of cement and clinker. For the three months that ended on 30 September 2015, China Resources Cement reported a loss of US$32m, compared to the profit of US$155m for the same period of 2014.
Namibia/China: China's Asian and African Business Management has teamed up with a Namibia's Whale Rock Cement to set up a US$350m cement plant. The project will see the creation of 400 jobs.
A few years ago, Whale Rock Cement came onto the Namibian market with its Cheetah Cement brand. This triggered a fierce competition with the existing cement suppliers, leading to a price war that drove Whale Rock off the market.
The plant, about 245km from the capital Windhoek, will be the second cement plant in Namibia after Ohorongo Cement, which produces 500,000t/yr. Whale Rock Cement Public Relations Officer Manfred Uxamb said that a comprehensive feasibility study has been completed and that a limestone survey has also been carried out. "Together with our partners, we have performed a comprehensive investigation of the land plot, limestone, clay, waste iron oreand gypsum," said Uxamb, adding that they had found that all these resources meet requirements. "The survey also included market research that proved that the project is feasible. The feasibility study was presented to the Government of the Republic of Namibia and approved." According to Uxamb, the area chosen for the plant has enough limestone deposits to last more than 40 years.