WORLD: The need for a sustainable approach in cement production

One of the most important of all building materials, cement is also one of the most polluting, with significant amounts of greenhouse gases released during production.

Cement manufacturing begins with mining limestone and burning it in gas and coal fired kilns at extremely high temperatures (approx. 1450°C) to transform it into a lumpy grey material known as clinker. This clinker is then crushed into cement powder in grinding mills.

Cement is the ‘glue’ that binds sand and aggregate to make concrete in construction work. Concrete’s ready availability, durability, versatility and relative cost ensure its continued (and growing) use in the building industry.

However, cement is highly polluting due to the significant levels of greenhouse gas emissions, which occur primarily during the chemical reaction when limestone is burned releasing CO2-e. The mining of limestone and transport of cement together with the energy required add further to the CO2-e output. With 900 kilograms of CO2-e estimated to be emitted for every tonne of cement manufactured, the cement industry alone generates approximately 5 per cent of global CO2-e emissions.

Having recognised the severity of the environmental issues associated with cement manufacturing some years ago, Independent Cement and Lime invested heavily in the development and production of a more environmentally sustainable alternative to cement - Ecoblend.

WORLD: Big emitters in cement sector join forces to decarbonize production

Sixteen of the world’s largest cement companies –an industry notorious for its high carbon emissions – backed a plan at the climate summit Wednesday that would see their industry shift toward the use of de-carbonization technologies.

The announcement represents something of a coup in a climate summit that has lacked a focused discussion on de-carbonizing industry, despite warnings from the UN’s Intergovernmental Panel on Climate Change that deploying technologies to achieve this are critical to limiting global warming to 2 degrees Celsius.

“The IPCC has indicated and we believe that keeping down emissions in the future will be far more expensive without carbon capture and storage technologies,” said Bellona President Frederic Hauge. “This makes cement companies real movers in employing capture technologies.”

Cement, as earth’s second most frequently used commodity after water, accounts for 5 to 8 percent of anthropogenic CO2 emitted worldwide, according to various estimates, making the industry a major source of global warming comparable in climactic impact to steel.

That puts emissions from cement production at 3.9 gigtatons annually, according to International Energy Agency, or IEA, figures.

Rob van der Meer, public affairs director on global environmental sustainability for Germany’s giant Heidelberg Cement, told Bellona that his industry had “no choice” but to use carbon-capture technology “if the world is to stay within the 2C temperature rise.”

“We have a carbon problem, yes,” van der Meer said in an interview with Bellona at the Le Bourget negotiations center. “There is simply now way to produce cement without carbon release.”

But he said that, according to objectives laid out by the IEA in its Cement Technology Roadmap of 2009, the worldwide cement industry would work to decarbonize its emissions to the tune of 17 million tons per year.

Though the plan envisions such measures on every continent where cement is produced, van der Meer said IEA studies indicate that most of those reductions would first have to occur in Europe.

The conundrum for the industry, he said, is that you can’t simply demand that cement production simply wind down – it’s too necessary for too much.

Indeed, the demand for cement is so pervasive that by 2050, van der Meer said each person on earth would “consume” about 500 kilograms of cement, equivalent to 2 cubic meters of concrete per year.

Further, cement and steel alike are crucial for the infrastructure that will support the shift to renewable energies such as solar and wind that the Paris Climate Summit is pushing to power the world by the end of the century.

“Cement is important for building wind farms, especially those that are offshore,” said van der Meer.

It also plays an enormous role in building dams for hydro-electric power.

“There’s a certain buffer of carbon emissions that will always occur with cement production that you can’t go below,” said Keith Whiriskey, Climate Technologies Project Manager for Bellona Europa. “The process for making cement produces a lot of CO2, so the best thing to do is trap it.”

Whiriskey said that making cement involves breaking up limestone with acid at temperatures of 1000 degree Celsius releasing calcium, oxygen and carbon.

Van der Meer said sticking points to moving the de-carbonization project forward in Europe center around low carbon prices in the European Union’s Emissions Trading System, or EU ETS, and that, by turn, threatens the commercial viability of using pricey carbon capture technology – and van der Meer insists it’s pointless to move on such projects unless there’s a profit to be had.

“The reality is that industry doesn’t invest in something just because it’s an interesting new technology,” he said. “So the EU needs to create the proper business conditions for it.”

For the moment, the real innovations in capturing and trading carbon are happening elsewhere. Jonas Helseth, director of Bellona Europe, said the EU has so far failed at this, and risk losing de-carbonizing technologies to other parts of the world.

Boundary Dam, the one-year-old carbon capture and storage unit in Saskatchewan, Canada, cost €1 billion, just as a first blush of how costly up front investments in such projects can be. But the price of a second unit slated for construction at the coal-fired power station is estimated to cost at least a third less.

Texas oil drillers have long known the worth of using CO2 for enhanced oil recovery, or EOR, which involves pumping the greenhouse gas at high pressure into nearly depleted oil wells to bring hidden hydrocarbons to the surface.

And China’s pilot carbon trading programs are second only to EU ETS, according to a World Bank analysis. China’s anticipated national market, however, would regulate 40 percent of the country’s economy, surpassing EU ETS and covering 3 to 4 billion tons of CO2 worth up to $65 billion by 2020.

And van der Meer says Heidelburg will be all to happy to operated in that lucrative market.

“If there is not a business case for [trading CO2] in Europe, then we will move where there is a business case for it,” he said.

Hauge pointed out that would be a loss for Europe, but that it would still end up netting the planet 17 million fewer tons of CO2 per year, which jibes with IPCC recommendations to deploy decarbonizing technology.

One place in Europe where cement production with carbon capture for which Heidelburg has high hopes is the company’s NORCEM production unit in Brevik, Norway. The Norwegian government has provided €50 million in investment toward the NORCEM project, which will act as a blue print for Heidelburg’s future production plants with carbon capture.

Combining the use of biofuels at the plant with carbon capture is expected to significantly reduce the facility’s CO2 emissions, with the end goal being complete carbon neutrality.

“We have a vision that our product in a life-cycle perspective will be carbon neutral by 2030, and we believe that carbon capture from cement production is an important part of and long step toward achieving this vision,”Gunnar Syvertsen, CEO for Heidelberg Cement Northern Europe said in a 2013 statement.

What’s gotten stickier here in Paris than the notion of carbon capture is transportation and storage of CO2 after it’s caught.

Whiriskey said geologic storage of CO2 has faced opposition from many environmental groups, and has barely been mentioned in high-level discussions at all.

Van der Meer said Heidelburg will do the catching, but someone else has to keep what they pull down – such as oil companies.

But Whiriskey said this is a natural division of labor: Heidelburg can make the investment to catch the CO2 before it fouls the atmosphere, but the oil industry is the one that possesses the geological know-how to safely store carbon and keep it from seeping back into the atmosphere.

Bellona will therefore continue tracking a course for carbon storage.

“We have to take the IPCC recommendations for CCS seriously,” said Hauge. “We may end up standing alone in this, but we’re not going to back away from a problem just because it’s difficult.”

WORLD: LafargeHolcim sets strenuous targets even as sales decline

LafargeHolcim, the cement giant in the midst of a postmerger restructuring, lifted its proposed dividend and said it now expected to generate free cash flow of at least Sf10bn ($9.9bn) by the end of 2018.

The targets eclipsed Wednesday’s third-quarter sales and profit figures that missed analysts’ expectttations, although some analysts said the medium-term goals were too ambitious.

The tie-up between Switzerland’s Holcim and France’s Lafarge, announced last year, forged the biggest cement maker aiming to cut costs and counteract slumping demand for cement after the financial crisis depressed construction.

CEO Eric Olsen said the company was closing Chinese plants and combining management at businesses there to cut costs and ride out declines in demand.

"China is a fantastic example of … bringing Lafarge and Holcim assets together where we can do things in reducing costs that we wouldn’t have been able to do otherwise," Mr Olsen said. "We need to prepare ourselves for demand that’s not going to come back. In a situation like that, it’s low cost that wins."

Weakness in demand in China and Brazil was being partially offset by "positive trends" in the US, Mexico, Britain and the Philippines, the firm said.

The Sf10bn cash flow target would mark a turnaround from 2014, when free cash flow was Sf1.76bn at Holcim and €592m at Lafarge.

The company proposed a 2015 dividend of Sf1.50, up from the Sf1.30 it suggested in July.

"It’s my ambition that by the end of 2018, LafargeHolcim will have changed the game in free cash flow generation in our industry," Mr Olsen said. "We’ll be looking at returning value to shareholders through dividends and/or share buybacks."

The company’s shares were up 3.9% in early trade, after falling 18.6% this year.

Operating earnings before interest, tax, depreciation and amortisation (ebitda) declined 16.1% in the third quarter to Sf1.64bn, below the Sf1.75bn forecast by analysts.

Quarterly sales dropped 8.7% to Sf7.83bn, missing analysts’ forecast for Sf7.92bn.

"The mid-term outlook seems promising," J Safra Sarasin analysts said in a note. "The US, UK and most countries in Asia Pacific and Latin America showed good development."

LafargeHolcim said it was targeting operating ebitda of at least Sf8bn by 2018 and cumulative free cash flow of at least Sf10bn from 2016 to 2018.

Some analysts said these targets were too bullish.

"We find it difficult to reconcile the current poor operating performance with management’s optimistic medium-term outlook," Bernstein’s Phil Roseberg said in a note.

Third-quarter net profit rose to Sf812m, from Sf504m a year earlier, on asset sale gains.

LafargeHolcim expected divestments of Sf3.5bn next year.

WORLD: Sustained Global Cement Demand Growth Expected

Global cement consumption is expected to record sustained growth in 2015, with further gains forecast for 2016, according to analysis presented in the recently-released Global Cement Report Eleventh Edition.

The report, which covers key cement market data for over 170 countries, reveals that total world consumption rose by 2.6 per cent in 2014 to 4140Mt, compared to the 7.7 per cent growth achieved in 2013. Global demand growth has been driven by the phenomenon of China, which has increased its share of world consumption to reach 59 per cent in 2014.

Closer analysis shows that steady growth has prevailed in the emerging markets where in 2014 consumption (excluding China) increased by 2.7 per cent 1387Mt. In the mature markets of Europe and North America, overall demand growth returned to positive territory in 2014, rising by 2.8 per cent to reach 290.6Mt.

Leading markets 

The top five consuming nations in 2014 were China, India, USA, Brazil and Russia. A total of 10 Asian countries are represented in the top 20, and while two east Asian nations - the Philippines and Malaysia - entered the top 20 for the first time, France and Italy fell out, reflecting the decline of western European consumption. 

Demand in China reached a record 2462Mt, translating into an annual increase of 2.6 per cent - the slowest growth rate in decades and well below the double-digit levels seen in recent years. These indicators suggest that the country is nearing peak demand for cement as the construction industry resets to a slower, more sustainable growth path.

In terms of regional performances, North America has been leading gains in the developed world where last year demand rose by a vigorous 8.2 per cent in 2014 versus 3.9 per cent a year earlier.

The best-performing regions across the world over the 2012-14 period have proved to be in the emerging markets of sub-Saharan Africa, led by central Africa with double-digit rate increases in each year.

Growth outlook 

Looking ahead, general improvements in global growth trends are expected in 2015 and 2016, with forecasted increases of 3.3 and 4.6 per cent, respectively. North and central Asia are set to excel, as will much of Africa. Overall growth in Asia is forecast to be around 3-5 per cent, partly reflecting China's expected lower growth course. The Middle East and western Europe are expected to rebound, but obvious downside and political risks prevail.

WORLD: CEO Named for Cement Titan LafargeHolcim

The boards of France’s Lafarge and Switzerland’s Holcim have approved Eric Olsen for the role of chief executive officer once the firms merge, creating the world’s biggest cement company, they announced on Thursday.

The 51-year-old French and American national is currently executive vice president for operations at Lafarge, said a Holcim statement.

Last year the two companies announced plans to create a cement titan employing more than 130,000 people, which would generate annual sales of 32 billion euros ($34 billion) and underlying profits of 6.5 billion euros — a major event in the global construction industry.

The merger still must be approved by two-thirds of shareholders at each of the two companies at special general assemblies.

In March the two companies renegotiated the exchange ratio for the merger — nine Holcim shares for 10 Lafarge shares — after the sharp rise in the Swiss franc drove up Holcim’s value.

WORLD: Holcim’s No. 2 Investor Said to Plan Vote Against Lafarge Merger

Holcim Ltd.’s second-biggest shareholder, Eurocement Holding AG, plans to vote against the Swiss company’s merger with Lafarge SA, even after the cement makers last week agreed on new terms and management changes to placate investors, said a person familiar with the matter.

Eurocement isn’t satisfied with the revised terms, which would give 0.9 of one Holcim share for one share of Lafarge, instead of the original one-for-one ratio, the person said, asking not to be identified because the considerations are private. The investor is also seeking other improvements, the person said. Representatives for Eurocement couldn’t immediately be reached for comment. Holcim and Lafarge declined to comment.

The initial terms and management lineup became a sticking point after Lafarge’s results lagged its Swiss peer since the merger was announced in April last year. Lafarge chief Bruno Lafont, who had been designated as chief executive officer of the merged company, will now become co-chairman, after Holcim managers said they didn’t want him as CEO.

The continued opposition by Russia’s Eurocement, which holds 10.8 percent of the Swiss cement maker, could derail the merger if other investors follow suit. Two thirds of shareholders need to approve a capital increase that is necessary for the deal to go through at an investor meeting in May.

Earlier this week, Ethos foundation, which advises Swiss pension funds, said that it also still has doubts about the combination of both companies. Funds advised by Ethos may represent about 4 to 5 percent of investors at the meeting. Holcim’s fourth-biggest shareholder, Harris Associates, told newspaper Finanz und Wirtschaft today it hasn’t decided yet whether to support the merger as the new terms are “not perfect.”

Swiss newspaper Handelszeitung reported earlier today that Eurocement is not pleased with the new terms of the planned merger, citing people close to the matter.

WORLD: Holcim-Lafarge deal back on solid ground

Europe’s two largest cement companies Holcim and Lafarge have rescued a stumbling €41bn merger by reconciling differences over financial terms and management that nearly caused the collapse of one of the biggest deals in recent years.

The agreement ends several days of intense negotiations to salvage a tie-up aimed at creating enormous cost savings and a powerhouse in the cement and crushed rock industry.

What was initially agreed as a one-for-one share deal when it was announced last April will now be adjusted in favour of Holcim, after the Swiss company outperformed its French rival financially and saw the relative value of its shares enhanced by the strengthening of the Swiss franc.

Under the new arrangement, which could be disclosed as soon as Friday, Holcim will pay about 0.90 of its shares for each one in Lafarge, people familiar with the matter said.

In addition, Bruno Lafont, chief executive of Lafarge, is now set to become co-chairman of the combined group rather than its new head.

As the two companies have worked on integration matters, Holcim’s senior management has grown concerned in recent months over the 58-year-old Frenchman’s ability to meld two distinct business cultures and to deliver on the €1.4bn in annual cost savings promised by the two companies.

He will share the chairman role of the enlarged entity with Wolfgang Reitzle, Holcim chairman.

A new candidate to lead the group is not expected to be named on Friday, the people familiar with the situation added.

Private talks to salvage the €41bn merger were thrust into the spotlight on Monday after Holcim said the deal to create the world’s biggest cement company could “not be pursued in its present form”.

The Swiss group, whose value has surged since the deal was agreed last April, wanted its shareholders to get a bigger stake in the merged entity. They also protested the appointment of Mr Lafont as the head of the new company.

However, large shareholders on both sides remained supportive of the deal even as problems surfaced — motivated in part by the large cost savings promised.

In spite of the uncertainty in recent days, shareholders in Irish cement company CRH on Thursday rubber-stamped a €6.5bn deal to buy production facilities Holcim and Lafarge are selling to satisfy anti-trust rules.

After falling sharply on Monday, shares in Holcim recovered to SFr75.80 by the close on Thursday, marginally above their level at the end of last week. Lafarge shares, which also fell sharply on Monday, pared some losses by Thursday’s close, to €62.30.

WORLD: Vicat voit son CA bondir de 8%

Le cimentier Vicat termine l’année 2014 avec un chiffre d’affaires en progression de 8%, une bonne nouvelle due entre autres à la croissance soutenue de son activité en Inde et au Kazakhstan ainsi qu’à la solidité de sa situation financière.

Le groupe Vicat affiche donc un chiffre d’affaires consolidé 2014 de 2,4 milliards d’euros, soit une hausse de 8% en comparaison à la même période un an plus tôt, à périmètre et taux de change constants. Ces bons résultats s’expliquent par une croissance importante enregistrée en Inde et au Kazakhstan et à un redressement de l’activité en Egypte et aux Etats-Unis. Cependant, bien que le groupe Vicat dispose d’une situation financière robuste, le contexte macro-économique particulièrement difficile en France perturbe l’activité du cimentier dans l’Hexagone.

Les résultats de Vicat se décomposent comme suit : l’activité ciment s’envole avec une hausse de 17,7%, pendant que la branche "Béton & granulats" recule de 1,5% ; le segment "Autres produits et services" se maintient avec une timide hausse de 0,3%. C’est désormais l’activité ciment qui pèse le plus lourd dans le chiffre d’affaires total du groupe (53,7%), derrière le béton et les granulats (31,9%) puis les "Autres produits et services" (14,4%).

WORLD: Bankers ready debt as bids due on Lafarge Holcim assets

Bankers are lining up just over 1 billion pounds ($1.51 billion) of debt financing to back private equity firm KKR’s potential bid for the UK assets of cement makers Lafarge (LAFP.PA) and Holcim (HOLN.VX), banking sources said on Friday.

The UK assets are for sale alongside a number of other assets worth about 12 percent of France's Lafarge and Swiss peer Holcim's combined revenues, in order for a planned merger between them to go ahead creating the world’s top cement group with $44 billion in annual sales.

Binding bids are due January 12, the banking sources said.

Debt packages of just over 1 billion pounds for the UK assets equates to around 5.5 times Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) of approximately 170 million pounds, including undrawn debt.

Holcim's French activities, Lafarge's German interests and other operations in Austria, Hungary, Romania, Serbia, Britain, Canada, the Philippines, Mauritius and Brazil are up for sale in a deal which could fetch 6 billion euros ($7.08 billion) in total.

The sale of the assets has attracted interested from a number of bidders including Irish cement maker CRH (CRH.I); Blackstone (BX.N), Cinven and Canadian pension fund CPP; and a team consisting of CVC and sovereign wealth funds the Abu Dhabi Investment Authority (ADIA) and Singapore's GIC. Meanwhile, Italy's Italcementi (ITAI.MI) and Turkey's Sabanci (SAHOL.IS) are expected to bid for some assets.

India’s Aditya Birla Group is expected to bid for continental European assets, two of the sources said.

Bankers are working on debt packages of up to 4.5 billion euros to back private equity bids for all the assets, equating to around 5.5 times EBITDA of approximately 725-730 million euros, including undrawn debt.

Lafarge, Holcim and KKR declined to comment. Aditya Birla Group was not immediately available to comment.

WORLD: EU Approves Holcim, Lafarge Cement Merger

Cement companies Holcim Ltd. and Lafarge SA cleared a major hurdle toward their planned $43 billion merger after antitrust authorities in Europe said the deal could go ahead, subject to significant asset sales across the region.

The deal, if approved by other global competition regulators, would reshape the global cement industry, spawning a construction-materials juggernaut. It had been expected to face significant hurdles from antitrust authorities, particularly in Europe, given the scale of the two companies’ operations in the region.

Margrethe Vestager, the European Union’s top antitrust official, announced the decision on Twitter late Monday. “Acquisition of Lafarge by Holcim is subject to conditions. The merger can proceed,” Ms. Vestager tweeted, adding that it would be “good for growth.”

The EU’s approval is conditional on divestments by the two companies that Ms. Vestager described in a statement as “very substantial.”

Holcim will have to sell all of its businesses in the Czech Republic and Slovakia, two plants in Spain, and most of its activities in France relating to cement, ready-mixed concrete and aggregates, according to a statement from the European Commission, the bloc’s top antitrust regulator.

Lafarge will be required to sell all of its businesses in Germany and Romania, as well as U.K. businesses that are carried out through Lafarge Tarmac, a joint venture with Anglo American PLC, with the exception of a single cement plant.

The companies won’t be allowed to close the deal until the commission has approved the buyers of the assets, the regulator said.

“With the remedies, we have ensured that the creation of an increased global footprint of the group will not come at the expense of competition in the EU,” said Ms. Vestager.

In twin statements, Holcim and Lafarge said they were “actively pursu[ing] negotiations for the sale of these assets with potential buyers, who will have to be preapproved by the European Commission.” Lafarge said it still expected the merger to close in the first half of next year.

Holcim, of Jona, Switzerland, and Paris-based Lafarge have been working with regulators around the world to satisfy anticompetition fears.

The two companies are awaiting approvals from other parts of the world, including the U.S., Canada, Mexico and India for the deal to proceed. Authorities in some countries, such as Russia and South Africa, already have given the deal their blessing. Holcim and Lafarge had combined sales of $39.3 billion in 2013.

Analysts estimate the two companies could raise as much as 10.3 billion Swiss francs ($10.7 billion) from the sale of cement factories and other facilities.

Unveiling their merger plans in April, the companies had pledged to sell assets that generate roughly €5 billion, or $6.8 billion, in annual revenue to address competition concerns. Holcim finance chief Thomas Aebischer has said some 60 parties, a mixture of buyout firms and building-materials companies, had submitted bids for all or some of the assets.

Holcim has said it expects to agree to deals with potential purchasers by the end of this year or early 2015 as it moves ahead with its timetable to complete the merger during the first half of next year.

INDIA: Indian regulator says cement giants Holcim-Lafarge merger to hurt competition

The Indian competition regulator over the weekend said that the equal merger between Holcim of Switzerland and Lafarge of France is likely to hurt competition in the country.

The Competition Commission of India (CCI) said that it ''formed a prima facie opinion that the combination is likely to have an appreciable adverse effect on competition.''

It has now directed both companies to publish details of the merger to the knowledge of the public and rival companies that may be affected or likely to be affected by such combination.

The CCI also directed both companies to publish details of the merger in all India editions of four leading daily newspapers, including at least two business newspapers, and also host the same details on their respective websites.

It has sought comments or objections from the public within 15 days of merger details being published.

In April this year, Holcim and Lafarge, two of the world's biggest cement companies, agreed to merge, creating the world's biggest cement maker, with a market cap of $50 billion and annual sales of nearly $43 billion. (See: Cement giants Holcim and Lafarge announce merger of equals)

The merged company, to be called LafargeHolcim, will be based in Switzerland, listed in Zurich and Paris, have a workforce of 136,000 people and generate annual savings of more than €1.4 billion ($1.9-billion) over three years.

The mega deal would require approval from regulators from around 17 countries, including from Europe, Canada, the US, Brazil, India, Serbia, Romania, Hungary, Morocco, Philippines and China.

The merger would see the annual sales of Lafarge-Holcim more than double to that of its next-biggest competitor, HeidelbergCement AG of Germany, and far above Beijing-based China National Building Materials Group Corp, and Cemex SAB of Mexico.

Regulators from seven countries have already approved the deal, including Russia, Ukraine, Turkey, Morocco, Kenya, South Africa and Singapore.

But both companies would have to sell assets worth more than $11 billion is several countries mainly in Slovakia, France, Romania, Germany, the UK, India, the US, Canada, Brazil and the Philippines.

Holcim has already received 60 bids for cement factories and other facilities it has put on the European market.

The size of the merger requires a lengthy examination before it can be approved, European Competition (EC) Commissioner Joaquin Almunia had said just after the merger was announced.

''Given the size of the two companies, and that they are the two main players in the European market, yes, it's clearly a phase 2 analysis," Almunia said, and added that a review that could take several months.

The EC takes 25 working days even for a preliminary review and normally opens a Phase 2 investigation of up to four months if it has serious concerns over a deal.

The CCI had earlier said that it will look closely at the transaction since the merged company will be the largest cement producer in India after Aditya Birla group's UltraTech and could have a sway over pricing.

Aditya Birla Group is the largest cement maker in India with a capacity of 62 mtpa, followed by Holcim and Lafarge, who have a combined capacity of 57.5 mtpa. 

UltraTech Cement is among the world's top 10 cement companies and manufactures and markets ordinary Portland cement, Portland blast furnace slag cement and Portland Pozzalana cement. It also manufactures ready mix concrete.

The company, which has grown through acquisitions, has 11 integrated plants, one white cement plant, one clinkerisation plant in the UAE, 15 grinding units, 11 in India, 2 in the UAE, one in Bahrain and Bangladesh each, and five terminals, four in India and one in Sri Lanka.

Lafarge entered the Indian market in 1999, through its cement business. The Paris-based company currently has four cement plants in India and is the market leader in the ready-mix concrete business with 80 plants.

Lafarge, through its operating companies, Lafarge India and Lafarge A&C, provides cement, ready-to-use concrete, aggregates, fly ash, clinker and waste management services, while Holcim, through its operating companies ACC and ACL provides, cement, ready-to-use concrete, clinker, fly ash, EcoSand and waste management services.

There are around 65 cement companies in India and around 185 - 188 cement plants, out of which 77 are located in Andhra Pradesh, Rajasthan and Tamil Nadu.

WORLD: Heidelberg not to buy Lafarge or Holcim assets

HeidelbergCement has confirmed it will not buy any of the businesses that must be sold off as part of its rivals' merger.

In a brief statement, the German company told its shareholders it had now stopped looking at the assets being put on the block by its rivals, as it wanted to fortify its balance sheet and put cash into its own projects instead.

Given the importance of cement to developing economies - and Lafarge and Holcim's dominant positions in the market - their merger has come under enormous scrutiny from regulators worldwide, with a suite of asset sales required for the deal to complete.

The €40bn of assets that have been put up for sale by the French and Swiss groups include businesses in Austria, France, Germany, Hungary, Romania, Serbia and the UK.

The Heidelberg statement in full:

"After a thorough analysis, HeidelbergCement has decided to refrain from the ongoing bidding process for the assets offered for sale of Lafarge and Holcim in the frame of its merger proceedings.

The company intends to use the anticipated proceeds from the announced sale of its building products business in North America and United Kingdom for debt reduction and for its own high quality growth projects."

WORLD: Ang eyes Lafarge’s cement plants in PH

Businessman Ramon Ang said Monday he is seriously looking at acquiring the cement plants of Lafarge Republic Inc., whose French parent Lafarge S.A. is merging with Holcim Ltd. of Switzerland.

Ang did not say if San Miguel or Eagle Cement Corp. was the one interested in acquiring Lafarge’s assets in the Philippines.“We are looking at it. We are seriously looking at it. It will be a big transaction if ever,” Ang, president of San Miguel Corp. and chairman of Eagle Cement Corp., said in an interview at the sidelines of the listing ceremony for Petron Corp.’s P10-billion preferred shares at the Philippine Stock Exchange.

Lafarge Republic plans to sell six assets, including FR Cement in Teresa, Rizal; Fortune Cement in Taisan, Batangas; Continental Cement and Republic Cement in Norzagaray, Bulacan; a cement company in Cebu, formerly known as Durano Cement; and Asturias Cement also in Cebu.

Lafarge Republic’s decision to sell its cement assets is part of the planned merger between Holcim Ltd. and Lafarge S.A.

Lafarge Republic earlier said it planned to sell its other assets, including Lafarge Iligan Inc., Lafarge Mindanao Inc. and Lafarge Republic Aggregates Inc., and Star Terminal at the Harbour Centre in Manila to Holcim Philippines Inc.

Holcim Philippines said the company would conduct a financial and technical study on the assets before finalizing the acquisition plans.

The study will be completed by the middle of 2015.

San Miguel Corp. ventured into cement business with the P3-billion acquisition of 35 percent of Northern Cement Corp., a company personally owned by San Miguel chairman and chief executive Eduardo Cojuangco Jr. last year.

Meanwhile, San Miguel Corp. said it was no longer in the list of qualified bidders for British snacks maker United Biscuits.

“I think we were not included in the short list,” Ang said.

He said despite being excluded from the shortlist, San Miguel would continue to look for investment opportunities overseas. “We will continue to look for more investments, whether domestic or international investments,” he said.

The private equity owners of United Biscuits, Blackstone Group and PAI Partners, have been working on plans for a sale or a public share listing by the end of the year. The auction for United Biscuits is reported to be worth 2 billion pounds ($3.2 billion).

WORLD: Cement which reduces CO2 emission developed

The researchers of Switzerland, India and Cuba have come together to develop limestone calcined clay cement (LC3) which will help reduce carbon dioxide emission (CO2) by almost 30 percent.

The research aided by the Swiss government is a new blend which substitutes up to half of the carbon intensive materials traditionally used to make cement.

"The LC3 project is an example of scientific and technical collaboration between Switzerland and India. The innovative cement production process on which these institutions are working is of great economic and environmental significance," Switzerland Ambassador Linus von Castelmur, told IANS Tuesday.

The LC3 is a synergetic hydration of clinker (a dark grey nodular material made by heating ground limestone and clay at a temperature of about 1400-1500 Celsius), calcined clay and crushed limestone to achieve the performance required from commercial cements, with clinker factors as low as 0.40.

It is also said that the raw materials are easily available in many of parts of India and Cuba.

Having completed with the first phase, the new cement also has lower processing and capital investment which can be economically favourable to standard cement production.

India is the first country where cement was tested in laboratory and in the field. India is the second largest producer of cement accounting for around eight percent of the country's industrial carbon dioxide emissions.

"The testing and application phase is over, now it has to pass through standardisation committee before it is accepted by the industries. The research which has been done will not be a patent protected but available to everyone," Castelmur said.

The project is at the tune of $4.3 million and has researchers from Federal Institute of Technology, Lausanne; Indian Institute of Technology (IIT) Delhi, Mumbai, Chennai, and Technology and Action for Rural Advancement.

WORLD: Cemex-Holcim Spain Deal Cleared by EU as $50 Billion Lafarge-Holcim Merger Looms

Cemex will be able to buy Holcim’s Spanish assets after being given the green light by the European Commission, an important step in a huge shake up in the cement industry which could bring the proposed $50 billion creation of Lafarge-Holcim a step closer.

The Holcim assets comprise plants and quarries dedicated to the production and supply of cement, aggregates, ready-mix concrete and mortar in Spain. The Commission concluded that the acquisition would not raise competition concerns since the merged entity will continue to face sufficient competition from its rivals in all markets concerned.

By selling off these assets, Holcim and Lafarge would be nearing its $5 billion sales target in its bid to satisfy the competition authorities in order to merge into the new cement behemoth.

The Spanish transactions are part of a series of sales between Holcim, Lafarge and other European cement players contributing to the €5 billion target.

This latest development follows news earlier in the summer that competition authorities were not satisfied with the proposal for Spain.

On 23 April 2014, the Commission opened an in-depth investigation over concerns that the proposed transaction could substantially lessen competition in the market for grey cement by removing Holcim assets as an actual competitor in eastern Spain.

The Commission was also concerned that the proposed transaction could facilitate existing coordination between grey cement producers in central Spain or make future coordination more likely. However, these concerns have been dispelled.

Cemex also intends to acquire control of the whole of Holcim's activities in cement, ready-mix concrete and aggregates in the Czech Republic, an operation cleared by the Czech competition authority in March 2014.

Earlier this year Lafarge agreed to buy back Anglo American's stake in Lafarge Tarmac so it can sell the entire unit in a move which would again bring the merger with Holcim a step closer. If successful, the new company would become the largest cement producer in the world.

WORLD: More than 100 expressions of interest in Holcim, Lafarge assets

Cement makers Holcim (HOLN.VX) and Lafarge (LAFP.PA) have received more than 100 expressions of interest in assets they must sell ahead of their planned merger, the Swiss company's chief executive said on Monday.

The two companies proposed a multi-billion euro series of asset sales two weeks ago in their efforts to get regulatory approval for the planned merger, unveiled in April, which would create a combined group with $44 billion in annual sales.

Holcim Chief Executive Bernard Fontana told journalists at a briefing in Zurich on Monday that the companies had received more than 100 expressions of interest, including from private equity funds and other cement makers, with several parties indicating a desire to buy the entire portfolio of assets.

This is up from the 50 notifications of interest they had received when they published the list of disposals on July 7.

Fontana said the companies would start discussions with potential bidders in August, but declined to say when the deadline for bids would be.

The two cement groups are seeking buyers for operations in Austria, Hungary, Romania, Serbia, Britain, Canada, the Philippines, Mauritius and Brazil to address competition regulators' concerns about their combined market power.

The sell-off will affect some 10,000 workers out of a global total of 130,000 and account for around 3.5 billion euros ($4.7 billion) of sales.

Fontana said "several people" had shown interest in buying all the assets put up for sale, but said the final decision determining the choice of buyer would depend on the price.

European labor unions have asked both cement groups for specific employment guarantees that would be binding for the buyers.

Asked whether Holcim would give preference to any bidders which guaranteed they wouldn't cut jobs or close sites, Fontana declined to be specific but stressed the assets for sale were not restructuring cases.

"It's not an issue. They are good assets. If there was a need (to cut jobs) I would do it," he told journalists at a briefing in Zurich. "The divestments are linked to overlaps. They are good companies, they are competing and this will continue."

He added that the possibility of an initial public offering or spin-off for some of the assets remained an option.

In an interview with the Wall Street Journal published earlier on Monday, Fontana said the merger was "on track" and that the two cement groups were in "advanced" talks with European competition regulators over their proposed combination.

Antitrust reviews are expected in about 15 countries, and Fontana said filings had already been made in the United States, Canada, Mexico, India and Russia, he told the paper.

WORLD: Holcim und Lafarge müssen abspecken

Die Zement-Hersteller Holcim und Lafarge machen im Hinblick auf ihre Fusion vorwärts. Am Montag gaben sie bekannt, welche Unternehmensteile aus Wettbewerbsgründen verkauft werden müssen. Die meisten Verkäufe gibt es in Europa, wo die Überlappungen gross sind.

Konkret trennt sich Holcim von seinem Geschäft in Frankreich, Serbien sowie von den operativen Aktiven in Ungarn, wie es in einer gemeinsamen Mitteilung heisst. Im Gegenzug stösst Lafarge sein Geschäft in Deutschland, Rumänien und La Réunion ab. Hinzukommt die Zementfabrik im österreichischen Mannersdorf, sowie Lafarges Tarmac Aktiven in Grossbritannien.

Ausserhalb von Europa wird Holcim sich aus Kanada und Mauritius zurückziehen. Auf den Philippinen wollen die beiden Konzerne die Zusammenführung ihrer Geschäftsaktivitäten prüfen.

Noch keine Details gaben Holcim und Lafarge für ihre Geschäfte in Brasilien bekannt. Der brasilianischen Wettbewerbsbehörde werde demnächst eine Liste vorgesehener Verkäufe vorgelegt werden, heisst es weiter.

In der Ankündigung wird ein grosser Teil der Veräusserungen kommuniziert. Beide Gruppen werden aber prüfen, ob zusätzliche Desinvestitionen aufgrund von Überlappungen notwendig sind.

WORLD: HeidelbergCement aims to sell building products business this year

HeidelbergCement aims to offload its U.S. and British building products business this year to have the best chance of buying cement assets that Lafarge and Holcim must sell when they merge, a source with knowledge of the company's plan said.

HeidelbergCement had said it can wait to get the best price for the business in the U.S. and Britain, which makes mainly bricks, concrete pipes and roofing tiles and is worth at least 1 billion euros ($1.36 billion).

But its bigger rivals Lafarge and Holcim have committed to shed around 5 billion euros of assets to secure a green light from competition authorities for their tie-up and are likely to push through the divestments next year.

HeidelbergCement's stated priority is debt reduction but it has also hinted it may seize opportunities to snap up assets.

"The Lafarge-Holcim merger could speed up Heidelberg's asset disposal plans because Heidelberg would then be able to use its proceeds to buy some of the stuff that Lafarge-Holcim will divest," the source said.

Heidelberg is likely to sell the building materials business by the end of the year, the source added.

An analyst who follows the company said he believed HeidelbergCement would use no more than 500 million euros of the divestment proceeds for acquisitions because its main goal was still to relieve its debt burden.

Moody's and Fitch have a rating of Ba1 and BB+ on HeidelbergCement's debt. The company missed its debt reduction targets last year partly because it needed to pay a 161 million euro German cartel fine. Its net debt at the end of 2013 was 7.523 billion euros, up from 7.047 billion a year earlier.

"I could imagine Heidelberg would use the proceeds to acquire interesting assets from Lafarge-Holcim, but I don't think it would use all of it because they've always said they wanted to get back to an investment-grade rating," said the analyst, who did not want to be identified.

HeidelbergCement is in the process of hiring Bank of America Merrill Lynch, Deutsche Bank and BNP Paribas to help with what will probably be a trade sale of the building products business, although a possible flotation was also being pursued, two people familiar with the situation said.

Some sources aware of the matter said HeidelbergCement had begun to separate the UK and U.S. assets from the rest of its building products division. One said the company was establishing the accounts of the assets up for sale using U.S. GAAP accounting rules.

A spokesman for HeidelbergCement declined to comment.

POTENTIAL BUYERS

Apart from private equity funds, potential industrial buyers may include U.S.-based Acme Brick Company, owned by Warren Buffet's holding Berkshire Hathaway, Australian building products company Boral, as well as European players such as Austrian brick maker Wienerberger.

A spokeswoman for Wienerberger declined to comment beyond saying: "We look at everything in the market that concerns our core business".

Boral declined to comment and Berkshire Hathaway could not immediately be reached.

Analysts estimate the assets for disposal make an annual profit before interest, tax and amortization (EBITDA) of around $120-150 million. HeidelbergCement said their annual revenue is around 1 billion euros.

Chief Executive Bernd Scheifele told analysts this year that the assets may be worth 10-11 times EBITDA, or up to $1.65 billion, based on a similar deal between U.S. private equity firm Lone Star and Lafarge last year, according to a second analyst who also wanted to remain anonymous.

Heidelberg's building products arm was acquired from Hanson Plc in 2007. The German company held onto the assets until the U.S. and UK housing markets recovered.

Some analysts questioned whether the business can really fetch the kind of price mentioned by CEO Scheifele.

"There's no doubt there's recovery potential in the earnings of the building materials businesses in the UK and the U.S, where you've got growing markets. But when you get 10-11 times EBITDA, you're pricing in quite a lot of growth," said Sanford Bernstein analyst Phil Roseberg.

He said businesses in which EBITDA is growing by 5 percent a year were likely to command a multiple of 8 times. ($1 = 0.7345 Euros) 

WORLD: Les cessions issues de l'opération Holcim excitent les fonds

Blackstone, Cinven et le fonds de pension canadien CPPIB étudient une offre commune sur 5 milliards d'euros d'actifs appartenant à Lafarge et Holcim, selon deux bonnes sources obtenues par le 'Financial Times'. Les deux cimentiers doivent en effet se séparer d'une partie de leurs portefeuilles en vue d'obtenir le feu vert des autorités antitrust à leur projet de fusion, ce qui ne sera pas une mince affaire.

Outre ces trois-là, d'autres prétendants seraient aussi sur les rangs. Début juin, des rumeurs évoquaient déjà une alliance, entre CVC Capital Partners et KKR, et l'intérêt d'autres cimentiers. Le 'FT' parle également de Carlyle, Apollo, TPG ou de BC Partners, soit à peu près tous les gros fonds spécialisés en capital-investissement industriel de la place.

Le 7 avril dernier, les deux cimentiers avaient annoncé un projet de fusion entre égaux. La question de l'ampleur des cessions qui seront demandées par les autorités antitrust conditionnera la portée réelle du rapprochement, notamment au niveau des synergies. Si l'opération aboutissait, nous la considérerions comme une transaction de rupture dans un secteur qui est déjà connu une globalisation massive ces dix dernières années, expliquait à l'annonce du projet l'analyste de Deutsche Bank Glynis Johnson.

Lafarge a fait appel à Rothschild et Holcim à Goldman Sachs comme conseils. Crédit Suisse, HSBC, Morgan Stanley et BNP Paribas ont pour leur part été mandatés pour plancher sur les cessions

WORLD: Votorantim aumentará produção em 8 mi de toneladas até 2018

Entre 2012 e 2013, a Votorantim Cimentos expandiu para seis novos países: Espanha, Turquia, Marrocos, Tunísia, Índia e China.

Nesse processo de expansão, empregou quase 3.000 pessoas e tornou-se efetivamente uma companhia global, com representações na Europa, África e Ásia.

A empresa foi o destaque do setor de Indústria da Construção da 41ª edição de Melhores e Maiores. 

Em abril, a companhia obteve grau de investimento em escala global pelas três principais agências de risco: Standard & Poors (BBB), Moody’s (Baa3) e Fitch (BBB).

Está bom? Para a Votorantim, não. “Acabamos de lançar o plano 8-18: aumentar 8 milhões de toneladas de produção de cimento até 2018”, afirmou Walter Dissinger, presidente executivo da companhia, no prêmio Melhores e Maiores 2013, realizado pela Revista EXAME.

Um dos passos para isso será a inauguração da fábrica de Primavera, no nordeste do Pará, com capacidade de produção anual de 1,2 milhão de toneladas anuais.

“Nossos investimentos continuarão firmes para atingirmos a meta nos próximos quatro anos”, afirmou o executivo.