Holcim and Cemex announce ‘adapted parameters’ to transaction proposal in Spain

Holcim and Cemex have announced changes to the Spanish element of their series of transactions in Europe, which were first announced in August 2013. The original proposal would have seen Holcim and Cemex combine their operations in the country, with Cemex holding a 75% share and Holcim the remaining 25% stake.

Binding agreements have now been signed with ‘adapted parameters’ – namely that Cemex will acquire Holcim’s 0.85 million t Gador cement plant and its 0.9 million t Yeles grinding facility. Holcim will retain its other assets in the country, which comprise 2.2 million t of cement production capacity and aggregates and ready-mix operations.

According to Holcim’s statement: ‘This change of parameters reflects the change in the strategic landscape following the announcement of the proposed merger of Holcim with Lafarge. Hence Holcim and Cemex will remain competitors in Spain and Czech Republic. In Germany, Holcim aims to optimise its portfolio by better connecting its operations in Northern Germany and the wider region.’

Under the changes, Cemex will pay Holcim €45 million in cash. The transactions are due to close in 1Q15. As a result, Cemex expects a recurring improvement of US$20 – 30 million in EBITDA, including synergies. Holcim expects additional operating EBITDA of at least €10 million per year.

The transactions in Germany and the Czech Republic will remain in line with the companies’ original announcement. This will see Cemex acquire Holcim Cesko (1.1 million tpa cement plant, four aggregates facilities and 17 ready-mix sites) in the Czech Republic and Holcim will purchase Cemex’s operations in western Germany.

The European Commission granted unconditional clearance for the transactions in Germany in June 2014 and the Czech Republic’s competition commission has also approved Cemex’s purchase of Holcim Cesko. In September 2014, the European Commission cleared the transactions in Spain in their original form. It has not yet been announced whether the updated plans will need to be resubmitted to the EU Commission.

Adapted from press releases by Louise Fordham

Read the article online at: https://www.worldcement.com/europe-cis/30102014/cemex-holcim-sign-binding-agrements-on-updated-spanish-transactions-765/