Displaying items by tag: Takeover

India: In a clear move away from its traditional engineering, procurement and construction (EPC) business, Shriram EPC, part of the financial services major Shriram Group, is ready to pick up a majority stake in Sree Jayajothi Cement. The company's board approved picking up a significant equity share capital of Sree Jayajothi by partially converting the dues owned by Sree Jaya Jothi into equity.

Shriram EPC, which provided EPC services to the latter's cement plant at Yanakandala village in Andhra Pradesh, has invested its own money for the project. Shriram EPC hopes to complete the deal by mid-April 2012, according to its managing director and CEO, T Shivaraman.

"For us it is a strategic move," explained Shivaraman. "For the group it is a diversification to get into the cement business. This move will have long term benefits for us. Since Sree Jayajothi could not return the money that we invested over the years, we thought it fit to convert the dues into equity. We are converting part of the dues into equity and it will be for majority stake."

Sree Jayajothi has been struggling to find a suitable investment partner for its cement business, with repayment so far taking longer than expected. Over recent years Shriram EPC has invested over US$100m in the plant.

India: Aditya Birla Group is considering buying Lafarge's operations in South Africa to further bolster its presence overseas. The US$35bn conglomerate, which owns India's biggest cement producer Ultratech, is conducting an initial assessment for a possible bid for the Lafarge unit. Lafarge South Africa Holding has a value, comprising both equity and debt, close to US$800-900m according to a report from December 2011. It has a cement capacity of over 3Mt/yr and it operates 20 quarries and 55 ready-mix concrete plants.

The sell-off of its cement operations in the region is part of Lafarge's plans to restructure its global operations through a series of asset sales to retire debt, which currently stands at over US$18bn. Lafarge may also sell off its majority equity holding in Pan African Cement, which has its units in Zambia, Tanzania and Malawi.

A spokeswoman for the Aditya Birla Group declined to comment on the report. The group, one of the world's 10 largest cement producers, operates across 36 countries and has recently considered bids for overseas coal assets. Lafarge has also been unavailable for comment.

Another Indian company Shree Cement is also believed to have shown interest in the asset. "We have initially shown some interest in the project but we would not like to comment on the present status," stated an unnamed senior group official.

Brazil: Construction group Camargo Corrêa has denied that it is in talks to buy a remaining stake in Portuguese cement maker Cimpor.

Camargo Corrêa and industrial conglomerate Votorantim have been reported as being in talks to buy the additional stake. According to one source, Camargo Corrêa plans to take over Cimpor's operations in Brazil while Votorantim would consolidate assets of the Lisbon-based company outside of Brazil.

"There isn't any change in the position of this company regarding Cimpor," Camargo Corrêa said in a statement. Camargo Corrêa and Votorantim currently hold 54.1% of Cimpor.

The value of the remaining stake is about Euro1.5bn based on Cimpor's closing share price on 19 October 2011. Votorantim and Camargo Corrêa acquired 53% of Cimpor early in 2010 after beating an offer from steelmaker Companhia Siderúrgica Nacional.

Slovakia: The Antitrust Office has cleared the takeover of Vychodoslovenske Stavebne Hmoty (VSH) by Holcim Slovensko provided that Holcim sells its terminal in Vlkanova in Banska Bystrica County to an independent buyer linked neither to the companies nor to their groups. The watchdog conditioned the transaction in this way because it posed threats to the economic competition on the relevant market specialised in production and sale of grey cement and several local ready-mixed concrete markets.

Holcim, therefore, has proposed to sell the terminal. The regulator maintains that the new owner must be experienced and capable of preserving and developing the existing business and it must be able to expose Holcim to efficient competition after it takes over VSH. The decision on a suitable owner will be made by the watchdog. The terminal supplies cement made in the plant in Rohoznik to customers in the entire county.