By John Revill
ZURICH--Swiss cement maker Holcim Ltd (HOLN.VX) Thursday said it
was selling a 25% stake in its Cement Australia operations to
German peer HeidelbergCement AG (HEI.XE).
Holcim and HeidelbergCement will operate the unit as a joint
venture, with each holding a 50% stake in the business.
The terms of the deal, which has been approved by the Australian
authorities, were not disclosed.
The move is part of Holcim's so-called leadership journey
strategy, where the Jona-based company is aiming to increase
operating profit by at least 1.5 billion Swiss francs ($1.57
billion) from its 2011 levels by the end of 2014 through higher
sales and efficiencies.
Holcim Chief Executive Bernard Fontana, who launched the scheme
last year, wants to achieve this by increasing energy efficiency,
reducing logistics costs and making selective divestments.
Last year Holcim reduced its stake in Siam City Cement Company
in Thailand and sold its minority shareholding in its operations in
Guatamala, for a combined CHF374 million.
It also reorganized its European operations, with capacity
adjustments in Spain and the closures of plants in France and
Belgium, to reduce European cement production capacity by 10%.
The restructuring triggered CHF181 million in cash costs and
CHF457 million in writes offs, Holcim said in March.
The Holcim leadership journey contributed CHF158 million to the
company's annual operating profit in 2012, the company said at the
time, adding that the Holcim Leadership Journey would "gain further
momentum" in 2013.
Cement Australia operates two cement plants and a grinding
station in the east and southeast of Australia and in Tasmania with
a total annual capacity of 4.2 million tonnes of cement.
A new grinding station in Port Kembla, New South Wales, with an
annual capacity of 1.1 million tonnes of cement will go on stream
in 2013.
The company has more than 1,000 employees and recorded a
turnover of approximately 1 billion Australian dollars ($1.03
billion) in 2012.
Write to John Revill at john.revill@dowjones.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires