Holcim announces proposed rights issue

Holcim announces proposed rights issue
21 April 2006

Holcim has announced it will propose shareholders at the next AGM on May 12 a SFr1.7bn capital hike in order to support its growth strategy. The shares will be offered to existing shareholders, with eleven shares entitling to one new registered share, and will be underwritten by a banking syndicate led by UBS AG.  The provisonal issue price set by Holcim and the banking syndicate is SFr83 per new share. This may, however, be increased depending on market circumstances.  The final issue price will be announced prior to the AGM. The new shares will also be entitled to dividends on 2006 earnings. 

Holcim shares, which closed at SFr103.3 Thursday, are up 15 per cent since the start of 2006.  The company said it wants to seize further investment opportunities that ensure long-term internal and external growth in 2006. 
Holcim in early March said it will further increase its minority participation in Huaxin Cement in China to a majority, an investment that allows the company to increase its capacity to 36Mt by the end of 2007.  The company is also in the process of increasing its capacity in Romania, the US and Morocco. It is now also heavily committed to the Indian market through its major stakes in Gujarat Ambuja and ACC.

 "This value-based growth strategy must be supported by a solid balance sheet," the company said. "At the same time, Holcim would like to maintain its solid credit rating, even if interest rates increase." 
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