MANILA, Philippines — The country’s leading cement-maker Holcim Philippines Inc. (HPI) announced Friday the $2.15-billion buyout of its controlling stake by conglomerate San Miguel Corp. (SMC).
SMC has agreed to acquire 85.7 percent of the company for $2.15 billion, subject to closing adjustments, HPI disclosed to the Philippine Stock Exchange.
An agreement for the sale and purchase of shares in HPI was executed by Holderfin B.V., First Stronghold Cement Industries, Inc., SMC, and LafargeHolcim Ltd.
Holderfin B.V. will sell its shares in HPI and obtain consent from other shareholders, Cemco Holdings Inc. and Union Cement Holdings Corp., to likewise sell their shares to First Stronghold Cement Industries Inc., a wholly owned subsidiary of San Miguel Equity Investments Inc., which in turn is a wholly owned subsidiary of SMC.
This marks the biggest merger and acquisition deal in the history of local cement industry.
For its part, SMC said the acquisition would “increase the foothold of the San Miguel group in the cement business, and will provide the opportunity to implement its plan to expand its cement business nationwide.”
First Stronghold is required to conduct a tender offer of the shares of HPI. About 14.27 percent of the latter’s shares are held by the public.
SMC won an auction that pitted it against Anhui Conch, the largest cement manufacturer in mainland China, in the final round. UBS AG acted as its sole financial adviser for this transaction.
HPI was sold as part of the rationalization program of its multinational parent conglomerate, Switzerland-based LafargeHolcim.
The market-leading cement firm has cement manufacturing facilities in La Union, Bulacan, Batangas, Misamis Oriental, and Davao, as well as aggregates and dry mix business and technical support facilities for building solutions. It has an annual production capacity of around 10 million metric tons of cement and a market share of close to 30 percent.