Brazilian cement maker Camargo Correa Cimentos has launched a debenture issue worth 300 mln Brazilian reais ($112m) in the domestic market, an operation aimed at funding the company’s expansion plans. According to sources familiar with the situation, the cement maker’s owners are planning to turn the company into the third biggest cement producer in Brazil with presence in neighbouring Argentina.
Camargo Correa Cimentos now produces 2.8Mt of cement per year and has 8.0 per cent of the domestic market, which currently ranks it the fifth biggest cement producer in Brazil behind local companies Votorantim and Joao Santos, Cimpor and Holcim. Camargo Correa Cimentos said it would use the receipts from the issue to finance its growth via acquisitions or partnerships in Brazil and Latin America. The company’s main plan appears to be financing acquisition of Argentina’s Loma Negra cement maker.
The debenture issue is lead-managed by local investment bank Pactual and will be closed on January 27, 2005 as demand is expected to exceed offer. Camargo Correa Cimentos has been assigned brAA local currency credit rating by Standard & Poor’s.