Cemex to Sell U.S Assets to Grupo Cementos de Chihuahua for $400 Million
DOW JONES & COMPANY, INC. 12:35 PM ET 5/2/2016
MEXICO CITY—Cement and building materials company Cemex SAB has agreed to sell assets in the U.S. to Mexico's Grupo Cementos de Chihuahua SAB for $400 million as part of its plans to sell as much as $1.5 billion in assets this year and next.
The facilities include cement plants in Odessa, Texas, and Lyons, Colo., three cement terminals and a building materials business in El Paso, Texas, and Las Cruces, N.M, Cemex said Monday in a release.
Grupo Cementos de Chihuahua, or GCC, which has operations in Mexico and the U.S., said the planned acquisition will add 1 million metric tons of cement capacity to its existing 4.6 million tons.
The assets strengthen GCC's geographic footprint in key regional markets and support the company's long-term growth plans for the U.S. with a 45% increase in its cement capacity there, GCC said.
Cemex has a minority stake in Chihuahua-based GCC, which had sales last year of $752 million, of which around 70% were in the U.S.
The companies expect the deal to close by the end of this year.
Monterrey-based Cemex aims to sell assets for as much as $1.5 billion in 2016 and 2017 to pay down debt as its seeks to recover the investment grade ratings it lost during the 2008 global crisis. The company aims to lower its debt by $2 billion this year and next.
Cemex's debt was $16 billion at the end of March, although that included proceeds from a recent $1 billion bond sale that it will use to buy back existing debt in the current quarter.
Cemex shares were up 1.6% early Monday on the Mexican stock exchange.
Write to Anthony Harrup at anthony.harrup@wsj.com
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05-02-161235ET
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