CSN closes an agreement to purchase the Brazilian unit of LafargeHolcim for US$ 1.025 billion

The French-Swiss cement producer LafargeHolcim said, in a statement released this Friday, the 10th, that it had signed an agreement to sell its local operation to Companhia Siderúrgica Nacional (CSNA3). According to Lafarge, the enterprise value of its unit calculated in the transaction is US$ 1.025 billion (or R$ 5.3 billion). The acquisition should contribute to the expansion of CSN Cimentos, which had already acquired Brazilian Elizabeth three months ago.

Broadcast (the Grupo Estado’s real-time news system) anticipated in April that the French-Swiss company was looking for a buyer for the operation in Brazil. Later that month, the Broadcast Column reported that Benjamin Steinbruch, controller of CSN, had an interest in the asset. At the time, the Brazilian subsidiary of Lafarge had 10% of the Brazilian cement market.

In a statement released on Friday, Lafarge informs that the deal includes the five integrated cement production plants that operate in the country, four crushing stations, six aggregation units and 19 concrete mixing units.

The note does not inform the installed capacity of the factories, or details about the financial performance of the local operation. In Latin America, Lafarge’s cement sales, in tonnes, grew 28.3% in the first half, to 13.3 million tonnes. Net sales jumped 29.5% to 1.269 billion Swiss francs.

According to Lafarge, the sale of the business in Brazil strengthens its balance sheet, significantly reducing the company’s indebtedness. The multinational should use the resources it will receive from CSN to invest in the area of ​​solutions and products, strengthening Firestone, acquired at the beginning of the year.

“This divestment is another step in our transformation into a global leader in innovative and sustainable solutions, giving us the flexibility to continue investing in attractive growth opportunities,” says Jan Jenisch, CEO of LafargeHolcim. “We are pleased to have found a responsible buyer at CSN, who will develop the Brazilian unit in the long term.”

The multinational intends to continue operating in Latin America, with investments recently announced in Argentina and Mexico. In April, the company had 1.4 thousand employees in Brazil, with operations in cement, concrete and aggregates. A global leader in the sector, the company sold part of its local assets to Irish CRH in 2015.

According to 2017 data, LafargeHolcim was the third largest cement producer in the country in terms of installed capacity, behind Votorantim and Intercement. In the first half, CSN Cimentos had an installed capacity to produce 4.7 million tons of cement per year, according to documents delivered to the Brazilian Securities Commission (CVM).

Growth

This is the second acquisition made by CSN Cimentos this year. In June, the company acquired Elizabeth Cimentos and Elizabeth Mineração for R$ 1.08 billion, and the transaction was completed in August. The purchase added 1.3 million tons of capacity to CSN’s cement plant production.

In the second quarter of the year, CSN Cimentos had an adjusted Ebitda (earnings before interest, taxes, depreciation and amortization) of R$ 147 million, growth of 42.8% in a quarter, and represented 2.2% of the net revenue of the Group, with revenues of R$ 343 million, an increase of 23.6% in three months.

CSN even considered an initial public offering (IPO) for CSN Cimentos in the first half of the year, but postponed the plans. The company preferred to wait for a better window to proceed with the operation.

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