HeidelbergCement in deal with Tenir Group

The Kazakh industrial concern Tenir Group has agreed to sell its wholly-owned subsidiary Buchtarma Cement Company to HeidelbergCement.  Buchtarma Cement Company trades as Vostok Cement and has in integrated works in the north-western corner of the country, some 100km to the south of Ust-Kamenogorsk with an annual capacity of 1.6m tonnes.  It also includes a trading company with four terminals across the country.  These terminals are supplied by rail, either from the Buchtarma works, which currently has four wet process kilns and is producing to capacity, or from imports.  Cement is imported from a number of neighbouring markets, primarily from Russia.  Following the completion of the deal, Buchtarma Cement Company is to be renamed HeidelbergCement Central Asia.  For 2006, cement volume is estimated at around 2m tonnes in this fast growing market that is estimated to be consuming some 4.5m tonnes this year, an increase of approximately 20%.  Around 70% of Kazakh cement deliveries are in the form of bulk cement.  With this acquisition, HeidelbergCement will join Italcementi and the Malaysian-controlled Central Asia Cement as one of the three leading cement companies in this oil and Gas rich country that also counts two smaller producers.

This represents the first entry into a new market by HeidelbergCement since the Merckle family took a majority stake in the group.