Herbert Consunji spearheading Cemex PH come Nov
The Consunji group is set to close its acquisition of Cemex Philippines (CHP) by the end of November, with DMCI Holdings Inc. chief financial officer Herbert Consunji taking the helm.
Consunji told reporters on Tuesday night they were now just waiting for the fairness opinion of business advisory firm PwC and a mandatory tender offer for the shares held by minority shareholders of CHP before the financial closing on Nov. 30.
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Mandatory tender offers are usually done during significant acquisitions to ensure that minority shareholders are able to sell their shares at a fair price and avoid dilution.
Fairness opinions, meanwhile, indicate whether a transaction is reasonable from a financial perspective.
Hurdle cleared
Consunji likewise confirmed that he would lead CHP once DMCI completes the takeover of the country’s fourth largest cement manufacturer.
Article continues after this advertisementThis comes nearly a month after the Philippine Competition Commission (PCC) cleared the $305.6-million deal, allowing DMCI to move past the last regulatory hurdle.
Article continues after this advertisement“We do not anticipate [more] problems. [PCC] was the biggest hurdle,” Consunji said.
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In April, DMCI announced plans to purchase Cemex Asia BV’s shares in Cemex Asian South East Corp. (Casec) totaling 42.14 million, which will be divided among DMCI, the Consunji family’s unlisted firm Dacon Corp., and power unit Semirara Mining and Power Corp.
Casec owns 89.86 percent of CHP, whose net loss in the first quarter of the year ballooned by 158 percent to P917.84 million, reflecting a challenging environment for cement companies in the Philippines.
Profitability
Despite this, Consunji said they would be able to rid CHP of “low-hanging fruits,” such as management fees, to cut losses and eventually return it to profitability.
Last month, DMCI said it would issue 10 million preferred shares to Dacon for P1,000 each as the engineering and construction conglomerate prepares its books for the CHP takeover.
DMCI has also begun slowly integrating its business into the cement firm through Semirara, whose retail electricity supply arm signed an agreement with CHP subsidiary APO Cement Corp. for 44 megawatts of supply.
