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Boy, is the UltraTech Cement and Jaiprakash Associates deal dragging on. The agreement by UltraTech to buy cement plants from Jaiprakash Associates reached its latest revision this week when UltraTech upped its offer to US$2.40bn from the US$2.36bn offered at the end of March 2016. The deal also includes an additional US$70m for a cement grinding plant under construction in Uttar Pradesh.

This time round the haggling took place to the background music of Jaiprakash Associates’ mounting debts. It owes US$4.45bn to a group of lenders led by ICICI Bank. A repayment window was due to close on 30 June 2016. Defaulting this deadline could have switched the account to non-performing asset status. So, according to reports in the Indian media, the lenders forced a strategic debt restructuring scheme on Jaiprakash Associates. Or in other words they took control of the company. Alongside all of this UltraTech was allegedly trying to renegotiate the terms of the deal agreed in March 2016 following amendments to the Mines and Minerals (Development and Regulation) (MMDR) Amendment Act, 2015.

How paying more for the same assets benefits UltraTech remains to be seen. In addition US$1.78bn worth of Jaiprakash Associates’ debts will be transferred to UltraTech, according to Rahul Kumar, Director & CFO of Jaiprakash Associates. At US$118/t for new-ish production capacity it still seems like a good deal. Doubtless the devil lies in the (unseen) detail. Reports in the Indian media speculate that the lenders may have threatened UltraTech with rival bids.

To add to the confusion, the deal covers cement plants with a production capacity of 21.2Mt/yr but this total includes both integrated cement plants (clinker producing) and standalone cement grinding plants. Given the difference in cost to build a clinker production line compared to a grinding mill this makes assessing the value of the deal difficult.

UltraTech have described the purchase as a ‘geographic market expansion,’ which will allow its entry into markets of India including the Satna cluster in
Uttar Pradesh and Madhya Pradesh, Himachal Pradesh, Uttarakhand and coastal Andhra Pradesh. It has also stated that its cement production capacity (clinker and grinding) will rise to 91.1Mt/yr following the deal. As ever, the latest revised agreement is dependent on shareholder, creditor, high court and regulatory approval. UltraTech plan to complete the transaction by July 2017. What can possibly go wrong!?

Switzerland: LafargeHolcim has appointed Alessandra Girolami as the group’s new Head of Investor Relations from 1 September 2016. Girolami will report to group chief financial officer Ron Wirahadiraksa. She replaces Michel Gerber, who will leave the group.

Girolami joins LafargeHolcim from the Carrefour Group, where she has been in Investor Relations since 2005 and Head of Financial Communications and Investor Relations since 2014. She began her career at ABN AMRO as a sell-side analyst. Girolami graduated from ESCP Europe with a major in finance and holds a postgraduate degree in Applied Economics from the Institut d’Etudes Politiques in Paris.

Germany: Eric Jaschke has been appointed Chief Financial Officer (CFO) at Schenck Process Group with effect from 1 July 2016. Jaschke will preside over the Schenck Process Group’s global financial organisation, working closely with Andreas Evertz, President and Chief Executive Officer (CEO). Jaschke has already fulfilled the role of CFO on a provisional basis since October 2015.

Jaschke started his career at Schenck Process in 1999 as a specialist for international controlling. In this capacity he focused on building and advancing a management information system. He was CFO of Schenck Process Australia from 2006 to 2007 and became Managing Director of the company in Australia at the start of 2008. Jaschke returned to Germany in 2012 and led the Business Unit Heavy in Darmstadt, one of the four core Business Units of Schenck Process.

Jaschke holds a master’s degree in business administration at the Macquarie Graduate School of Management in Sydney, Australia. He gained his bachelor’s degree at the Baden-Württemberg Cooperative State University in Mannheim, Germany.

Greece: Heracles Cement Group, a subsidiary of LafargeHolcim, has announced the completion of a first phase of an investment plan to modernize its factory in Volos.

The Euro5m investment project aims to boost the competitiveness of the factory in the domestic market and to boost its export activity. The project has been interpreted by some as evidence of LafargeHolcim’s longer term confidence in the country, which has suffered from poor economic conditions and a weakened construction sector for much of the past decade.

Cyprus: Cyprus Cement has announced that it expects to see a ‘significant’ profit in the first half of 2016 compared to a marginal profit in the first half of 2015.

India: UltraTech Cement and Jaiprakash Associates have revised their deal for UltraTech to buy 21.2Mt/yr of cement production capacity from Jaiprakash Associates. The revised value of the deal is now US$2.47bn, up from US$2.40 agreed previously. UltraTech will have to pay an additional US$70m upon completion of a grinding unit under construction. The new agreement is an amendment to the 31 March 2016 scheme of arrangement., according to the Hindu newspaper.

The approval follows an agreement of Jaiprakash Associates’ lenders who invoked Strategic Debt Restructuring (SDR) scheme on 28 June 2016. This allowed the lenders may take control of the company and sell its assets to recover dues.

“Jaypee Group is determined to reduce its overall debt through its proactive divestment initiatives to help the group tide these current turbulent times caused by the economic slowdown,” said Manoj Gaur, Executive Chairman, Jaypee Group. The company has put together a committee of directors to explore its options to tackle its debt management.

India: Ramco Cements has received environmental clearance to upgrade the captive power plant at its Alathiyur cement plant in Tamil Nadu. The expansion will cost US$3.18m. The cement producer intends to add 6MW turbines based on air-cooled condensers, taking the total power generation to 42MW, according to Accord Fintech. The company will use imported coal from Indonesia for the power plant. The coal supply agreement was made in July 2014 with Devendral Coal International.

Vietnam: The Ministry of Construction is planning to sell its stake in Vicem through an initial public offering in the fourth quarter of 2016. The cement producer has said previously that the state is planning to reduce its holding to 51%. Investors from Indonesia and Thailand have expressed interest in acquiring stakes in Vicem, according to the Dau Tu newspaper.

Vicem, previously known as the Vietnam Cement Industry Corporation, has stakes in 31 companies, mostly cement producers and distributors. Its gross profit reportedly doubled last year to US$105.2m in 2015. It currently controls 34% of the market in Vietnam.

Burkina Faso: CIMAF, a subsidiary of Morocco’s Addoha Group, has started building a 0.7Mt/yr cement grinding plant in Bobo-Dioulasso. The plant will cost about Euro25m and will be completed by the end of 2017, according to the North Africa Post newspaper. The new plant will generate 200 direct and indirect jobs. CIMAF also operates a 0.5Mt/yr grinding plant in Ouagadougou.

Italy: HeidelbergCement has completed its acquisition of a 45% share in Italcementi from Italmobiliare. All conditions for the closing of the transaction have been fulfilled following the approval by the relevant competition authorities. The purchase triggers a mandatory tender offer to the remaining shareholders of Italcementi. HeidelbergCement expects the entire transaction to be completed in the second half of 2016.

“By adding Italcementi to our group, we are considerably strengthening our global footprint and innovation capabilities. We see significant potential for value creation with the realisation of synergies and by learning from each other’s best practices. From now on, we will focus all our efforts on the integration of Italcementi into our group,” said Bernd Scheifele, chairman of the management board of HeidelbergCement.

On 28 July 2015, HeidelbergCement and Italmobiliare entered into a share purchase agreement about the acquisition of a 45% shareholding in Italcementi. On 1 July 2016 HeidelbergCement acquired 157.17 million ordinary shares, representing 45% of the share capital of Italcementi for a total consideration of Euro1.67bn. 82.82 million ordinary shares were acquired against cash. The remaining 74.35 million ordinary shares were acquired against the assignment of 10.5 million newly issued shares of HeidelbergCement. Following this, Italmobiliare has become the second largest industrial shareholder of HeidelbergCement, with a stake of 5.3%.

In the share purchase agreement, Italmobiliare agreed to purchase certain non-core assets of Italcementi, including Italgen, Bravosolution, and certain non-core real estate. Italcementi had sold these assets to Italmobiliare on 30 June 2016 for total proceeds of Euro237m.

The acquisition of the 45% stake in Italcementi triggers the obligation to execute a mandatory tender offer to the remaining shareholders of Italcementi. The offering document will be filed with the Italian Securities and Exchange Commission (CONSOB), within 20 days after the closing, and will be published upon completion of CONSOB’s review period. The acceptance period will be agreed with Borsa Italiana. The acceptance period is expected to commence at the end of August 2016.