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Carmeuse buys one more plant from HeidelbergCement

Carmeuse buys one more plant from HeidelbergCement
18.02.2004, 00:00 16

Belgian Carmeuse Group, one of the world's top lime producers, continues its expansion on the Romanian lime market in full gear by buying the plant in Fieni held by German HeidelbergCement Group.

The deal, which is now only a draft submitted to the Competition Council for endorsement, is worth 4 to 8 million euros, as market sources estimate, and corresponds to the expansion plans of the two groups on the Romanian market.

Carmeuse's lime business amounts to nearly 1bn euro a year.

The Belgians could come to total four lime factories on the Romanian market following this deal and therefore account for some 26% of the total lime market, which reaches about 1.1 million tonnes, that is 30-31 million euros a year, according to market estimates.

The lime market in Romania is regarded as having a lot of growth potential, and progressed by approximately 10% last year. It has therefore become attractive for strategic international investors like Carmeuse or Germany's AHG Gruppe, which has just acquired French Lafarge Group's lime business.

The Romanian market is even more attractive in the light of the upcoming EU accession prospect, as well as of the presence of industrial consumers, which are bound to outsource their lime-producing units sooner or later.

On the other hand, German HeidelbergCement Group is backing out of the lime market completely by selling the facility in Fieni, pursuing, like the other producers, the strategy to focus on consolidating its position on the cement, concrete and aggregate markets.

"A draft has been submitted to the Competition Council, which includes no price, that is a notification of the understanding between the two parties on Carmeuse taking over Var Fieni SRL. At the moment, Carmeuse accounts for 37% of the free lime market, estimated to 630,000 tonnes, due to its three factories and should go as far as to 46% once it acquires the facility in Fieni. The cap set by the Competition Council is 50%. As soon as the Competition Council has endorsed the deal, the acquisition contract is supposed to be concluded that will include a price," sources close to the transaction told Ziarul Financiar.

The total lime market amounts to 1.1 million tonnes, as it includes the captive consumers, i.e. the industrial operators that make the lime they need themselves, such as COS Targoviste, Ispat Sidex, UPSOM Ocna Mures or Carbid Fox Tarnaveni, therefore the Belgians' market share is actually 26%.

Var Fieni produces approximately 70,000-80,000 tonnes of lime a year.


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