An extraordinary general meeting (EGAM) of Suez Cement Company has approved the sale of a 25 percent stake in the company to Ciments Francais, through its subscription to a capital increase of 10.1 million shares, and the acquisition of 5.9 million free float shares at a price of LE 51 per share. The total investment would amount about $224 million.
The Suez Cement EGAM also approved five agreements between the two companies. The first agreement organizes the relationship between the anchor investor and main shareholders in the company. The second bans competition between Cement Francais and Suez Cement within Egypt whether directly or indirectly, in addition to cooperation in investment in the cement industry in Arab Countries, the Mediterranean region and North Africa, reported Al-Alam Al-Yaum
Ciments Francais, now the largest shareholder in the company, is a unit of Italcementi Group. Italcementi hopes this acquisition would be a further step in strengthening its presence in high growth emerging markets, and would give it a solid position in the fast developing Egyptian market.
Ciments Francais Vice President Michel Lenier visited Egypt in last week, where he met with Egyptian Minister of Petroleum Sameh Fahim and the Minister of Public Business Sector Mukhtar Khatib, Al-Ahram reported. Following the meenting Khatib announced that this deal is hoped to enhance Suez Cement’s competitiveness by bolstering its administrative board and modernizing manufacturing technologies. He also identified Spain and Sudan as promising foreign markets for Egyptian cement.
Suez Cement net profit for the first half of the year 2001 dropped 44 percent to LE 73.38 million ($17.19 million), down from LE 130 million for the corresponding period the previous year, despite a four percent increase in sales that totaled LE 324.4 million compared to LE 311.7 million the year before, according to Sigma Securities. The company attributed the slip to the fact that the 1H 2000 profit was boosted by cash dividends of LE 56.24 million from Suez's holding in Torah Cement.
In 2000, Suez Cement Company took control of Tourah Cement and its consolidated turnover reached EP 1.287 billion ($301.5 million). Suez Cement Company has a capacity of 8.5 million tons on three sites—Suez, Quattamiah and Tourah—and its market share is approximately 30 percent. The company manufactures and distributes various types of cement, ready-mix concrete and concrete products. The company was established in 1977. Suez Cement has one subsidiary called Suez Bag Company. — (menareport.com)
© 2001 Mena Report (www.menareport.com)
