Nordic Capital linked to Aalborg

Nordic Capital linked to Aalborg
Published: 30 June 2004

Nordic Capital, the Swedish private equity firm, is in talks to take over Aalborg Portland, from FLS Industries, according to Scandinavian news sources. FLS has been preparing to sell Aalborg Portland and Unicon for months and according to rumours Nordic Capital is now seen as a favourite to take over Aalborg. Analysts put Aalborg Portland´s value at around DKK 3.5bn (Euro 471m) and Unicon at DKK 1bn (Euro135m). Presuming such a purchase was to go ahead, one can surmise that Nordic Capital’s interest in Aalborg would be a short-term affair with a further sell-on likely within one to two years.

Earlier there had been speculation that HeidelbergCement had expressed some interest but lack of finance and problems over competition issues within the Scandinavian market has dampened down such ideas. Cemex remains in the frame of course, particularly for Aalborg’s extensive white cement interests and Holcim may also have looked strategically at Aalborg if it is serious in wanting to build up its European white cement interests.

Recently RMC has also been linked to Aalborg, a move that would make a lot of sense when examining this UK-based company’s interests in the Nordic region and Aalborg’s sizeable levels of grey (and some white) cement into the UK market. However RMC is still struggling to optimise  its existing cement and ready-mix interests within Europe and any such additional financial  commitments are unlikely to be approved by the RMC board at this time.

As a wild card, UK-based Aggregate Industries, also a major UK cement importer could find Aalborg’s production base of interest. In such a case, raising the cash would not be a problem but for Aggregate to actually run a cement business would be a different story. Then, of course, there’s the acquisitive CRH of Ireland....