Votorantim Canadian loan

Votorantim Canadian loan
Published: 13 January 2004

St. Marys Cement Inc, a Toronto, Canada-based cement production unit of Brazil's industrial conglomerate Votorantim, has received a US$325m loan from a bank syndicate led by US Citigroup Global Markets Inc. The operation is aimed at refinancing another syndicated loan of US$300m related with the company's acquisition by Votorantim in 2001. The present syndicated loan was extended by 10 banks. 

"The company was new and had no performance to show on the market," Marcelo Martins, chief financial officer (CFO) of Votorantim's holding for the cement production sector, Votorantim Cimentos.  Martins said that St. Marys proposed to raise US$325m but it received offers for about US$1.2bn from banks and institutional investors in the United States and Canada. The cost of the loan was set at between 5.5 per cent and 6.0 per cent.

St. Marys was formerly owned by French cement group Lafarge and operates in Canada and the United States. The company has three cement plants, nine distribution terminals and 39 concrete factories.  With a production of 3.0Mta, St. Marys generates a revenue of nearly US$320m. Votorantim paid US$680m for the acquisition. The company has a share of 10 per cent of the cement sales in Canada and 2.0 per cent in the US market.