With the intention of expanding into China’s retail, materials and chemical industry, Taiwan’s Far Eastern Group could end up acquiring up to three cement companies. Far Eastern, fronted by chairman Douglas Hsu, says it has planned investments of US$500 million for this expansion into the Chinese domestic market.
Hsu clarified that attaining new companies in the Chinese cement industry will help Far Eastern achieve its goal of moving up the ranks from the current 13th position to top 10, as a supplier. Although Hsu did not offer information on the plans, speculation is rife regarding the potential acquisition targets, and although Hsu chose not to comment on this, Taipei based Asia Cement Corp. and Asia Cement China Holdings Corp. in Hong Kong both claim to know which companies are being considered.
At the close of trade in Taipei yesterday, Asia Cement climbed 3.3% to NT$31 – equating its highest leap in more than a year. Taiex Cement Index gained 3.6%, while the more wide-ranging Taiex rose 1.4%.
Kevin Lin from Fubon Financial Holding Co. in Taipei commented: “It’s very important for [Far Eastern Group] to buy cement makers in order to grab the growth opportunity.” He continued, “In the next three to five years, retail and banking will provide Far Eastern Group larger growth opportunities.”