Displaying items by tag: Debts

Kenya: Savannah Cement will sell assets including its Athi River grinding plant to compensate creditors, following its liquidation after entering administration in 2023, Business Daily has reported. Savannah Cement’s administrator PKF Kenya announced that the closing date for expressions of interest will be 16 August 2024. The company owes creditors US$139m. KCB Bank Kenya and Absa Bank Kenya, as preferential creditors, are owed US$68.5m and US$40.3m respectively, and will have their claims prioritised in the liquidation process. The forced sale value of these assets stands at US$58.6m, suggesting losses for unsecured creditors.

India: The National Company Law Appellate Tribunal (NCLAT) has declined to stay insolvency proceedings against Jaiprakash Associates, following a challenge by its board. The board has been suspended since the NCLAT admitted an insolvency plea against the company on 3 June 2024. Press Trust of India News has reported that ICICI Bank first initiated proceedings over outstanding debts in September 2018.

The board of Jaiprakash Associates submitted that it will remain ‘asset-rich,’ even after it sells cement plants to repay loans. It attributed its present ‘liquidity crunch’ to delayed government approvals, ‘prolonged’ litigation and policy changes. The NCLAT stated that it must admit insolvency pleas in cases of defaulted debt repayment, saying that a judicial resolution will prevent further depletion of Jaiprakash Associates’ assets.

Philippines: Cemex has agreed to sell its business in the Philippines to DACON Corporation, DMCI Holdings and Seminara Mining & Power Corporation. The buyers will acquire assets including Cemex Asian South East Corporation, which holds an 89% majority stake in Cemex Holdings Philippines. The parties will derive a purchase price for Cemex Holdings Philippines by deducting net debt and minority interests from an enterprise value of US$660m. Also included in the sale is a 40% indirect equity interest in both APO Land & Quarry Corporation and Island Quarry and Aggregates Corporation. Both mining companies have a combined enterprise value of US$140m.

Cemex says that it will complete the deal later in 2024, until which time its operations will continue in the ordinary course of attending to all clients, suppliers and other stakeholders. It plans to use the proceeds from the divestment to fund bolt-on acquisitions in key markets, to reduce debt and for other corporate purposes.

Kenya: Savannah Cement’s creditors voted in favour of administrator Peter Kahi’s debt reduction plan for the company on 16 April 2024. Kahi’s plan involves leasing out the site of the company’s Kitui plant, while also seeking a buyer for it.

Business Daily has reported that the Office of the Attorney General has declared Kahi's reappointment as administrator of Savannah Cement on 24 January 2024 as invalid.

Greece: Titan Cement International has published its preliminary results for 2023. The results indicate a 13% year-on-year rise in sales, to Euro2.54bn from Euro2.25bn in 2022. The unaudited figures show group earnings before interest, taxation, depreciation and amortisation (EBITDA) growth of 61% to Euro535m from Euro331m. As a result, it expects to more than double its net profit to Euro265m. The company's net debt ended the year at Euro660m, down by 17% from Euro797m a year earlier.

Mexico: Cemex will issue US$322m-worth of long-term sustainability-linked bonds on 20 February 2024. Noticias Financieras News has reported that the issuance will take place in two series: one of US$117.3m, with a 2.6-year floating rate, and one of US$205.3m, with a 6.6-year floating rate. HSBC will act as the intermediary.

Cemex said “The net proceeds from the reopening of the issues will be used to repay debt, seeking to accelerate the path to an investment grade credit rating."

India: The National Company Law Tribunal has initiated a corporate insolvency resolution process for Vadraj Cement. The former cement producer defaulted on US$10.5m in debts owed to Punjab National Bank. Mint News has reported that Vadraj Cement has total debts of US$843m.

Brazil: Investment banking and management company BTG Pactual will start receiving ‘binding proposals’ for prospective buyers of assets belonging to InterCement before the end of February 2024, Valor Online News has reported. These will reportedly include InterCement's stake in Argentina-based Loma Negra, as well as its Brazilian business. The latter may involve an outright divestment or the enlistment of a new significant partner. Companhia Siderúrgica Nacional (CSN) previously hired Morgan Stanley for negotiations with InterCement, and China-based Huaxin Cement has reportedly showed interest in its assets. While an outright acquisition might face challenges on grounds of competition, Brazilian market leader Votorantim Cimentos is nonetheless also ‘interested’ in a partial takeover. Continuing plant closures and debt-related asset disposals also potentially further complicate any deal. On the basis of CSN’s previous US$1bn acquisition of (10.3Mt/yr-capacity) LafargeHolcim Brazil, Valor Online News has estimated the sale price of InterCement’s Brazil business as US$1.6bn.

US: Portland Cement Association (PCA) chief economist and senior vice president of market intelligence Ed Sullivan forecast a recovery of the US economy in the second half of 2024 at the World of Concrete conference in Las Vegas, Nevada. However, Sullivan told attendees that the economy will ‘gradually weaken’ in the first half of the year. The anticipated weakening is compounded by the end of Covid-19 relief programmes, delayed monetary policy effects and credit tightening. Supporting growth throughout the year are some of the US$550bn infrastructure investments under the Infrastructure Investment and Jobs Act. The US government says that 40,000 new projects under the act are either in progress or completed.

Ed Sullivan said "In terms of the construction outlook, there will be a battle between interest sensitive construction sectors and less interest sensitive construction activity such as infrastructure spending and the construction of large manufacturing plants associated with the CHIPS and Science Act."

Iraq: Al-Diyar Al-Iraqia for Investments Company and Northern Region Cement have concluded a deal under which the former will acquire a 49% stake in the cement producer’s business in Iraq. Argaam News has reported the value of the deal as US$44m. Northern Region Cement said that the new strategic partnership would help it to further expand its investments in the promising market. It will use the proceeds of the deal to repay loans and for ‘external investments.’

Northern Region Cement plans to build a US$139m, 1.32Mt/yr integrated cement plant at an unspecified location in Iraq.