Italcementi boosts it lead position in Egypt

Italcementi boosts it lead position in Egypt
Published: 08 August 2005

Suez Cement, Egypt’s leading cement producer and 54.2 per cent controlled by the Italcementi subsidiary Ciments Français, has concluded an agreement to acquire a 68.7 per cent stake in ASEC Cement Company, currently the fifth largest cement producer in Egypt, and will launch a public offer for the remainder of the ASEC Cement equity. The deal values ASEC Cement at around US$590m.  Including debt taken on, the total cost of ASEC Cement is around US$800m, though through gearing up via Suez Cement and with the help of other investors that include the north-eastern Italian cement producer Cementi Giovanni Rossi, the actual financial outlay on the part of Ciments Français will be limited to some US$145m. Full details of the involvement of the various parties should be announced in September, once the deal has been concluded.  Assuming the deal goes through, Suez Cement should end up with a domestic market share just in excess of 30 per cent for grey cement and over half the Egyptian market in white cement.  The increased presence in Egypt should also be seen in the light of the fact that Egypt supplied 4.6Mt of clinker and 0.25Mt of cement to the European Union last year, with almost all of the clinker shipments going to Spain, Italy and Belgium, all markets where Italcementi is present.