San Miguel spending $800M to put up 2 cement plants
Conglomerate San Miguel Corp. is investing around $800 million to build two new cement manufacturing plants, preparing to meet an expected surge in demand from big-ticket infrastructure and private construction activities in the years ahead.
One of the plants will rise at cement affiliate Northern Cement Corp.’s existing facility in Pangasinan and the other in Quezon province, SMC president Ramon S. Ang said Thursday after the stockholders’ meeting of SMC’s parent firm Top Frontier Investment Holdings Inc.
Each of the plant will have an annual production capacity of 2 million tons and cost $400 million each, Ang said. The first plant will be completed by June 2017 and the other by end-2017.
About 50 percent of the project will be funded by equity and 50 percent by loan, Ang said. As such, around $400 million will be raised from borrowings for the cement plants, he said. Ang denied reports that SMC was raising $400 million through a seven-year loan facility for the construction of a new 300-megawatt coal-fired plant in Bataan. He said the project financing for this project had already been completed.
Coincidentally, he said SMC was planning to borrow $400 million not for power plant projects but for the cement business.
It was earlier reported that SMC had invested in Northern Cement, a company owned by its chair Eduardo “Danding” Cojuangco, in 2013.
The entry into the cement business is seen in line with the company’s large infrastructure projects. Ongoing projects include the Tarlac-Pangasinan-La Union Toll Expressway (TPLEx), the Boracay airport rehabilitation, Metro Railway Transit-7, Naia Expressway and the Skyway Stage 3 which will connect the South and Northern Luzon Expressways.
At present, the group is already operating South Luzon Expressway, Skyway 1 and 2 and Southern Tagalog Arterial Road (STAR) tollways.
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