China: Asia Cement and CNBM halt Shanshui offer

Following nine months of consideration, Asia Cement and CNBM have said they will not proceed with plans to buy the shares they do not already own in Shanshui Cement.

In a statement issued 10 May, the two companies, which combined own nearly 38 per cent stake in the Chinese cement maker, said they have concerns regarding the changes in Shanshui’s board, ongoing disputes and financial difficulties. They said the prolonged suspension of the shares has affected the ability to determine the value of Shanshui. Since the Tianrui Group formed the majority of Shanshui's board in Decemeber the two companies have remained relatively silent.

Given the ongoing delays in resolving disputes, and uncertainties over the impact on business operations, Mervyn Teo, analyst at Lucror Analytics, maintains his "not recommended" on Shanshui's ofshore bonds.

CNBM and Asia Cement have informed Shanshui Cement of the decision. Accordingly, the offer period has closed.