Displaying items by tag: board

Germany: Staff of HeidelbergCement in Germany will be employed on a ‘short-time’ basis, with hours reductions of up to 100%. HeidelbergCement says that it agreed upon the measure with employee representative bodies.

HeidelbergCement’s supervisory board and management board members have waived 20% of their fixed salaries in the second quarter of 2020 due to the financial impacts of the coronavirus outbreak.

Chile: The board of directors of Grupo Hurtado Vicuña (GHV) subsidiary Cemento Polpaico, which operates the 2.3Mt/yr integrated Cerro Blanco plant in Santiago and two grinding plants, has voted in favour of a merger with fellow GHV subsidiary Cementos Bicentario (BSA), which operates three grinding plants in the country. The Diario Financiario newspaper has reported that GHV first mooted with merger with the affected parties in February 2018.

Iran: Shahrood Cement Company, which operates a 1.9Mt/yr integrated cement plant in Shahrood in north-eastern Iran, produced over 0.2Mt of cement over the nine month period ending 21 December 2019. Semnan province Industry, Mine and Trade Organisation chair Behrouz Asvadi said that all of the cement produced by the company was exported to countries on the Caspian Sea as well as to Afghanistan and Uzbekistan. Revenue over the period was US$5.06m. The company is meeting to discuss issues in shipping and crediting.

Nigeria: Chinese-owned FabCom has unveiled a new fibre cement board at a ceremony celebrating the fifth anniversary of its presence in Nigeria. The Sun has reported that the company will manufacture 5Mm²/yr at its fibre cement board plant in Ambuja, which will be operational before 1 January 2021. FabCom managing director Liuxing Wang praised the product’s environmental friendliness, noting its durability, sound insulation, fire and water resistance and multi-use workability. FabCom’s investments in Nigeria total US$190m and have created 200,000 jobs, the company says.

South Africa: Prudential Investment Managers, one of the largest shareholders of PPC, has demanded the resignation of the chairman Peter Nelson. The shareholder sent a formal request to the cement producer because it wants the company to improve its operations, according to sources quoted by Bloomberg. In response PPC issued a statement admitting that it was talking to major shareholders over board positions. However, it defended the record of Nelson, saying that he had, “successfully led the company through a period of significant headwinds.”

PPC added that it has received nominations for Jabu Moleketi as successor to the chairman, and Anthony Ball and Noluvuyo Mkhondo to non-executive directorships.

Nelson was appointed as chairman of PPC in October 2016, shortly before it revived merger talks with AfriSam. Later in 2017 Canada’s Fairfax Financial Holdings made a bid for PPC on condition that it merge with AfriSam. Negotiations with LafargeHolcim, CRH and Dangote Cement but these were all abandoned.

LafargeHolcim’s investigation into its conduct in Syria claimed its biggest scalp so far this week with the shock resignation of chief executive officer (CEO) Eric Olsen. His decision landed with the publication of the group’s investigation into the conduct of the legacy Lafarge operations in the country in 2013 and 2014. As per the initial findings of the investigation that were released in March 2017, it confirmed that selected personnel had engaged in dealings with terrorists in connection to one of its cement plants in the country during 2013 until the unit closed in September 2014. The board decided that Olsen had no connection or even awareness of the misconduct. However, he decided to quit anyway in order to restore ‘serenity’ to the company.

In its latest public statement on the investigation, LafargeHolcim outlines five weaknesses with its compliance led by improper payments related to Lafarge Syria’s security and supply chain. It then goes on to list a failure of line management, inadequate controls over expenses and a failure to detect improper payments and improperly recorded payments. It’s all presented as ‘chaos reigned’ or wayward staff in tough circumstances trying to do their muddled best for the company. Unfortunately for this narrative, selected members of group management were aware of the situation and appeared to have done nothing about it. This then begs the question: who knew what when?

Olsen may have been exonerated by the board on his departure but he was Lafarge’s Executive Vice-President of Operations for Lafarge in 2014. If he didn’t know what was going on in Syria during his watch then he wasn’t doing his job properly or it was being hidden from him. The head of Lafarge itself at the time, Bruno Lafont, might also have been a viable target for discipline but he decided to stand down from the board of LafargeHolcim in early April 2017. No doubt other former members of the Lafarge management team may bear more responsibility. LafargeHolcim’s implementation of its remedial measures may turn up more culprits, as may the on-going criminal complaints process continues in France.

French newspaper Le Monde, the newspaper that originally broke the story, is probably on the money with its assessment that Olsen’s departure is actually the continuation of the boardroom battle between the board and its shareholders that has raged since before Lafarge and Holcim formally merged. Bruno Lafont was originally lined up to become the CEO of the new company until Lafarge’s worsening financial position compared to Holcim’s prompted a backlash from Holcim shareholders. Le Monde describes how LafargeHolcim’s shareholders include four prominent billionaires: Switzerland’s Thomas Schmidheiny, Belgium’s Albert Frère, Canada’s Paul Desmarais and Egypt’s Nassef Sawiris. Schmidheiny, readers may remember, was one of the principal actors who sunk Lafont’s bid to be CEO back in early 2015.

Placed in this context, Olsen’s departure might seem forced, especially if he had no connection to the debacle in Syria. LafargeHolcim has faced a tough couple of years following its formation with consistently falling sales revenue. Asset divestments and cuts have been the cure as the group struggled to find its new size. Yet, the group saw its adjusted operating earning before interest, taxation, depreciation and amortisation (EBITDA) start to rise in 2016 suggesting that the remedial action was starting to work. LafargeHolcim’s management and shareholders will be acutely aware of its performance so far in 2017 ahead of the public release of its first quarter results in early May 2017. Under these circumstances it seems unlikely that serenity will be restored to the upper echelons of LafargeHolcim any time soon.