Consunji set to close Cemex deal after securing PCC okay

Reuters

There is no more hindrance to the Consunji family’s target to expand to cement manufacturing after the country’s competition watchdog approved its acquisition of Cemex Asian South East Corp. (Casec).

In a disclosure, Semirara Mining and Power Corp. said the firm as well as two other Consunji companies, DMCI Holdings, Inc. and Dacon Corp., received the clearance from the Philippine Competition Commission (PCC) on Tuesday.

“The clearance of the PCC is one of the conditions precedents to, and a regulatory requirement necessary before, consummating the joint acquisition,” it said Wednesday.

This came less than four months after the Consunji group inked a share purchase agreement with Cemex Asia BV for the acquisition of all the latter’s shares in Casec, totaling 42.14 million shares.

Of this, DMCI would get 56.75 percent (23.92 million shares); Dacon, 32.12 percent (13.54 million shares); and Semirara, 11.13 percent (4.69 million shares).

The deal was valued at $305.6 million. The companies earlier said the price was still subject to “customary closing adjustments” based on Cemex Philippines’ estimated working capital, cash and debt levels.

Casec owns 89.86 percent interest in Cemex Holdings Philippines, Inc., which is engaged in selling gray ordinary Portland cement, masonry or mortar cement, and blended cement.

Isidro Consunji, chair of DMCI, Dacon, and Semirara, previously said that venturing into cement manufacturing was a “good, strategic addition” to the group’s portfolio.

Semirara Mining and Power Corporation, a part of the Consunji family’s core business, supplies coal to cement companies. It said coal is used to heat raw materials in the pyro-processing stage of cement production.

“We can leverage our group’s expertise and create new revenue streams from this acquisition,” Consunji said in April.

The deal is expected to close within 2024.

Cemex Philippines increased its net loss to P2 billion last year from P1 billion due to higher cost of sales. Its revenues also declined to P17.3 billion against the previous year’s P20.6 billion as the firm saw lower volume sold and cement prices.