Indonesia Gresik aims towards overseas expansion

Indonesia Gresik aims towards overseas expansion
29 September 2006

PT Semen Gresik Tbk is planning to acquire cement companies of Malaysia and Thailand in 2007 in a bid to become a regional player on cement industry. 
"We need to acquire cement companies in the region, maybe in Malaysia and Thailand. We will accelerate the growth by acquisition," said the vice president commissioner of Semen Gresik, Darjoto Setiawan after the company’s general meeting of shareholder yesterday. 
But he declined to mention the name of cement companies to buy. "[I will tell you] later. We may do this next year." 
He added that Rajawali Group also wants Semen Gresik to improve the production by developing new cement facilities. "We are financial investor that has come into Semen Gresik, but we want the company to develop itself to become regional player." 
Dwi said the management hopes the company will conduct an EGM next month to approve the financing plan on the new 2.5Mt facility.

The company needs US$303m to develop the new plant. To finance the new cement plant, the company will search for external funding of 65% to the US$303m investment, while the rest 35% will be from the internal one. 
Dwi added that the company posted domestic sales of 9.65Mt during the first eight month of 2006, and increase of 1.7% from 9.4Mt on the same period of last year. 
The company’s exports, he said, have declined by 27.6% from 1.26Mt to 916,000t during that period. 
"In general, the sales of cement until August 2006 reached 10.48Mt or down by 1.7% from 10.66Mt on the same period of last year," he said. 
But he is optimistic that the sales could grow by 10% so that the profit will also increase by 10%-20%. "Sales volume will be relatively the same, but we have increased the price after the oil price hike." 
Published under Cement News