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Buzzi enters Brazilian cement market

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World Cement,

Italian building materials multination, Buzzi Unicem, is to acquire a 50% stake in BCPAR SA, a subsidiary of Brennand Cimentos and owner of two full-cycle cement plants in Brazil. The acquisition will see Buzzi Unicem buy out the current minority owners of BCPAR, as well as part of Brennand Cimentos’ holding in the company, for €150 million.

BCPAR operates a plant in the northeastern state of Paraiba and in the southeastern state of Minas Gerais. The Paraiba plant was commissioned in August 2015 with a capacity of 1.4 million tpy of clinker and 1.7 million tpy of cement. The Minas Gerais plant began operation in May 2011 and has production capacity of 1.2 million tpy of clinker and 2.4 million tpy of cement.

“The agreement reached allows Buzzi Unicem to extend its industrial operations to the largest economy in South America and contributes to improve the geographical diversification of its regional presence,” the company said in a statement.

“Buzzi Unicem believes that the current downturn in the Brazilian economy, and in particular of the local cement industry, can be positively resolved starting from 2019. Brazil's key macroeconomic data concerning cement production are encouraging: population is expected to grow at an average annual rate of 1.1% and per capita cement consumption is currently at its lowest levels in years.”

The deal is expected to close by the end of the year and includes options for Buzzi Unicem to acquire the remaining 50% of BCPAR from Brennand Cimentos. Under the terms of the agreement, the two shareholders will co-control management of the company with equal participation in the board of directors and the shareholders’ meetings.

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Cement news 2018