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Business News/ Politics / Holcim buys Cemex’s Australia business for $1.64 billion
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Holcim buys Cemex’s Australia business for $1.64 billion

Holcim buys Cemex’s Australia business for $1.64 billion

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Zurich: Holcim will buy the Australian operations of Mexico’s Cemex for A$2.02 billion ($1.64 billion) boosting its position in Australia, and is planning a capital increase to raise the funds, the Swiss group said on Monday.

Holicm, the world’s second largest cement maker, will finance the deal entirely with equity and is calling an extraordinary general meeting in July to seek approval for a rights issue to raise around $1.86 billion.

The acquisition will give Holcim access to Cemex Australia’s positions in the fast growing markets in the eastern and southeastern states as well as in the mining belt of Western Australia, Holcim said.

“This important strategic acquisition enables the group to move into the aggregates and concrete business in an attractive mature market," Holcim said in a statement.

Holcim, which competes with France’s Lafarge, Mexico’s Cemex and Germany’s HeidelbergCement, will also buy Cemex Australia’s 25% stake in Cement Australia, of which Holcim already owns 50%.

Holcim also said on Monday it will invest around $234.1 million in the planned private placement of China’s Huaxin Cement, adding this deal would also be financed with equity.

Cemex started facing serious financial problems soon after it bought Australia’s Rinker in 2007 in one of the largest-ever emerging market takeovers.

Rinker’s US assets made Cemex the top cement maker in the US, but the deal closed as the US housing collapse struck.

Monday’s deal involves only Rinker’s Australia operations. The U.S. portion remains in the hands of the Mexican company.

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Published: 15 Jun 2009, 05:22 PM IST
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