Shui On Construction (0983) plans to phase out cement production, possibly by selling its stake in an under-performing China joint venture to partner and the world's largest cement maker Lafarge, as it shifts focus to real estate, its chief executive said.
Established in 2005, the joint venture, Lafarge Shui On Cement, posted an 80 percent drop in net profit for 2010 despite a strong rebound in China's cement sector that fuelled earnings for rivals.
"We are extremely disappointed by the performance of the joint venture," said Philip Wong, chief executive at Shui On Construction. "We will gradually phase out the cement business but its performance was bad and it can't be sold for a good price," he said. "Selling back to Lafarge is an option."
Lafarge Shui On is 45 percent held by Shui On, and 55 percent owned by Paris-based Lafarge
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