Displaying items by tag: HeidelbergCement
CRH submits bid for LafargeHolcim’s Indian assets
21 July 2015India: CRH has reportedly submitted a binding bid for the Indian assets of the newly formed LafargeHolcim, according to the Irish Examiner.
CRH is already paying Euro6.5bn for certain assets in the Americas, Europe and Asia that needed to be offloaded to enable the LafargeHolcim merger. The transaction, which will make CRH the third-largest building materials business in the world, is set to formally conclude by the end of July 2015, although it will take slightly longer to finalise the takeover of the Asian assets.
HeidelbergCement and Barings Private Equity (Asia) have also reportedly submitted bids for LafargeHolcim assets in India. The reports have suggested a price of US$600 - 800m for the Indian assets, which include Lafarge's Sonadih cement plant and the Jojobera grinding station in the east of the country.
Switzerland: According to Splash24/7, Italian ship-owners Giovanni and Vincenzo Romeo have ordered a new 6700t cement carrier with delivery scheduled for 2017. The ship-building contract was signed with Ningbo Xinle shipyard in China and is worth US$10 - 15m.
Originally from Naples, Italy, the Romeo family moved almost all of its shipping activities to Switzerland in 2010, where its Nova Marine Carriers shipping company is now based. Romeo Group historically has very close business relations with steel producers Duferco and cement producer Italcementi, but also regularly does business with other cement producers such as Lafarge, Holcim, Cemex and HeidelbergCement. Romeo's Nova Marine operates a fleet of some 40 bulk carriers, which includes five cement carriers and three self-unloaders.
Romania: According to Romania-Insider, Germany's HeidelbergCement will merge its three subsidiaries in Romania, Carpatcement Holding, Carpat Beton and Carpat Agregate, to form a single company called HeidelbergCement Romania.
Carpatcement Holding has three cement plants in Romania, whereas Carpat Beton owns 18 concrete stations and Carpat Agregate operates 14 quarries and aggregates exploitations. The internal reorganisation process will end in December 2015. HeidelbergCement has invested Euro500m in Romania to date.
India: According to the Financial Express, Jaiprakash Associates is close to selling its 1Mt/yr capacity cement plant at Sikandarabad, Uttar Pradesh to HeidelbergCement for around US$78.6m.
If the deal materialises, it would be the fifth cement asset sale by Jaiprakash Associates in little over a year. The group is looking to sell assets, including cement and power plants, to reduce its large debt. The aggregate debt of the group at the end of the 2014 financial year, which ended on 31 March 2014, stood at around US$8.65bn. Though it has so far divested assets worth US$2.36bn, the impact of the asset sales is yet to reflect on the group's balance sheet. It aims to cut down debt further by around US$1.57bn by the end of the current 2016 fiscal year, which ends on 31 March 2016. So far, Jaiprakash Associates has divested around 13Mt/yr of its overall cement capacity and is left with around 23Mt/yr.
Unnamed sources have said that Jaiprakash Associates also plans to sell two more of its cement plants, in Baga and Bagheri in Himachal Pradesh and Balaji in Andhra Pradesh, but the matter is stuck due to valuation issues. Aditya Birla Group's UltraTech Cement and HeidelbergCement have reportedly been in talks regarding their acquisition.
CEMBUREAU welcomes new president and vice president
17 June 2015Belgium: Daniel Gauthier, CEO of Western Europe-Africa and member of the managing board of HeidelbergCement, has been elected as president of CEMBUREAU for a two-year term after having completed his mandate of vice president over the last two years. He takes over from Peter Hoddinott, executive vice president of performance and member of the executive committee at Lafarge. In addition, Gonçalo Salazar Leite, CEO of Secil, has been elected as vice president of CEMBUREAU for a two-year term.
"The industry must now build upon the accomplishments of 'The Concrete Initiative," said Gauthier. The initiative was launched one year ago. "Concrete is essential to Europe's future, providing the buildings and infrastructure that society needs, as well as growth and jobs. The circular economy, competitiveness and climate change will also remain at the forefront of CEMBUREAU's activities."
"With the election of Gauthier, CEMBUREAU and the priorities of the european cement sector are in excellent hands," said Hoddinott. "He will advance and reinforce the agendas of putting the cement industry forward as a solution provider, where concrete can fulfill both the aspirations of the end users of construction and act as a partner in fulfilling the needs of policymakers."
"I take this opportunity to thank Peter Hoddinott for his commitment to the Association over the last two years," said Koen Coppenholle, CEMBUREAU chief executive. "We are now at a turning point. After a protracted period of negative growth, Europe is getting back on its feet. Indeed, our 2014 activity report shows some glimmers of hope for our sector."
Compared to 2013, 2014 cement production in the CEMBUREAU member countries saw a very moderate recovery, rising by 0.3% year-on-year to 235.5Mt after the drops recorded in 2013 and 2012 (1.4% and 8.2% respectively) and having fallen by 27% since 2007. Developments in cement demand were in line with the upturn in the general economic and construction environment, particularly over the second half of the year, reflecting somewhat improved sentiment and activity, despite tight budgetary conditions in many member states. Global cement production has been estimated at 4.3Bnt in 2014, translating into a 6.7% increase compared to the 4Bt recorded in 2013. The CEMBUREAU member countries accounted for 5.5% of global production, with China representing 56.5%, compared to 58.3% in 2013. Without taking into account China, global cement production increased year-on-year by 11.3%.
India: According to the Irish Examiner, CRH is being linked with a second potential Asian deal in as many weeks, this one with a price tag of around US$1bn. A Mergermarket report has it that CRH is one of 16 likely bidders for assets in eastern India being sold by Lafarge. The disposal makes up part of the conditions related to Lafarge's merger with Holcim.
Local press stated that CRH is an 'obvious bidder' given that it already has a presence in southern India and is in the process of buying US$7.32bn of assets as part of the LafargeHolcim deal. However, Mergermarket claims CRH is vying with HeidelbergCement, among others, for the new assets and has until the end of June 2015 to complete due diligence and until 15 July 2015 to submit a binding bid.
Israel/Palestine: Norwegian insurance giant KLP Kapitalforvaltning has divested two international building material companies, HeidelbergCement and Cemex, from its investment portfolio because of their operations in the West Bank.
According to news agency Haaretz, KLP divested its shares effectively on 1 June 2015, citing international law as set in the Hague and Geneva conventions. Haaretz added that the move is part of KLP's half-yearly review of companies in its portfolio. HeidelbergCement and Cemex acquired companies with Israeli subsidiaries operating quarries in Area C, West Bank, which is under complete Israeli civilian and military control as defined by the Oslo accords. KLP also excluded five more companies because of their income from coal-based operations, one for corruption, one for severe environmental damage and one for the production of tobacco.
"The extraction of non-renewable resources in occupied territory may weaken the future income potential of the local population, including the Palestinian residents. Moreover, when this is undertaken in a way that is difficult to justify within the requirements of the law of belligerent occupation, KLP considers that this activity represents an unacceptable risk of violating fundamental ethical norms," said KLP in a statement.
Estonia: HeidelbergCement's Kunda Nordic Tsement has reduced its output and made 30 employees redundant, citing a decline in clinker exports to Russia. CEO Meelis Einstein said that the need to cut expenditures has had a negative impact on suppliers of support services to Kunda Nordic Tsement.
Indocement disburses 94% of profits as dividends
15 May 2015Indonesia: Indocement Tunggal Prakarsa, part of Germany's HeidelbergCement, has secured shareholder approval to pay 94% of the company's 2014 profits, about US$382m, as dividends. Indocement booked US$403m in profits in 2014, a 5.2% increase from US$383m in 2013. During 2014, its net revenues totalled US$1.47bn, an increase from US$1.43bn in 2013.
President director Christian Kartawijaya said that net revenues had dropped by 3.8% year-on-year to US$331m in the first quarter of 2015 due to a decline in demand. He said that he hoped sales would increase in the second quarter, during which the government was expected to begin major infrastructure projects. "The recent cement price cut by the government affected our business, but it was not so bad because we were also able to cut costs," said Kartawijaya.
President Joko Widodo instructed state-run Semen Indonesia to lower the price of cement in January 2015, a move that led to private cement companies lowering their selling prices to keep up with competition. Indocement lowered its average cement prices by 4%. However, it also reduced its operational costs, including energy costs, distribution and logistics costs to compensate the fall in prices.
According to Indocement, domestic cement consumption grew by 3.3% in 2014, slower than the 5.5% growth seen in 2014, as the election year led to the postponement of a number of projects. Kartawijaya predicted that the number would grow to 3.5% until the end of the second quarter of 2015. In 2014, Indonesia's cement oversupply was 7Mt. This is expected to rise to 15Mt in 2015. "The demand slowdown will continue until the end of the second quarter if the government does not begin large-scale infrastructure projects," said Kartawijaya. The Indonesia Cement Association (ASI) has predicted that the Indonesian cement industry would see an increase of 6% in 2015 due to the government's large-scale projects, including new toll roads, railways, deep seaports and water dams.
Indocement has allocated US$344m in capital expenditure (capex) for 2015, higher than last year's US$298m. The capex will be used to finish its new US$153m plant in Pati, Central Java, while the rest would be invested in its gas turbine projects. Kartawijaya said that the new plant in Pati would start operating in the fourth quarter of 2015 and is expected to have 4.4Mt/yr of cement production capacity, boosting the firm's annual capacity up to 25Mt/yr.
Germany: HeidelbergCement has posted a 29% rise in core earnings in the first quarter of 2015 as it has benefited from a construction industry recovery in North America and the UK as well as low energy prices and the weak Euro. Operating income before depreciation (OIBD) was Euro299m and sales rose by 4% on a like-for-like basis to Euro2.84bn.
"Business development in the first quarter has strengthened our conviction in our outlook for 2015," said chief executive Bernd Scheifele. HeidelbergCement has reiterated its aim for significant improvements in 2015 sales, operating income and adjusted net profit thanks to strong demand in its core markets, the weaker oil price and Euro and efficiency measures.
HeidelbergCement also anticipates a significant decrease in financing costs due to the decline of net debt to Euro6.1bn from Euro7.8bn, following the sale of its building products business.