Mexico’s Cemex eyes asset sales in Europe
Cemex, the world’s third biggest cement maker, said on Tuesday it is looking to sell assets in Austria, Hungary and Britain to reduce its debt load of about $19 billion.
Cemex, which last year paid $16 billion for Australian rival Rinker, is considering selling aggregate and ready-mix plants in Hungary and Austria as well as British assets, including businesses that make floors, roof tiles and rail products. The Austrian operations generated revenues of about $274 million in 2007, while the British and Hungarian ones generated $98 million and $84 million, respectively, Cemex said.
The proceeds from the potential assets sale will be used for debt reduction, Cemex said in a statement. Cemex has said it would sell $2 billion in assets to pay down debt. Analysts said it may need to sell as much as $2.7 billion to meet its debt reduction targets. Sales of the European assets could fetch $800 million, Mexico City-based Ixe brokerage estimated in a report. Cemex
CEO Lorenzo Zambrano said last month the company would only sell assets if it could get good prices. Cemex is anxious to control debt, which surged to 4.1 times earnings before interest, taxes, depreciation and amortization (EBITDA) in the Q1 of this year, according to Credit Suisse. (Reuters)
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