Cemex has closed or reached binding agreements for sales of approximately $750 million, which it says represents 50% of the low end of the December 2020 divestment target range.
The company’s divestment initiative is part of the ‘A Stronger Cemex’ plan, which includes a $1.5 to US $2 billion asset disposal target by the end of 2020. Since then, the company has announced the divestment of assets in the Baltics and Nordics, the terminal in Manaus, Brazil, aggregates and ready-mix assets in Germany, the white cement business, including the Buñol cement plant in Spain. The expected proceeds of these transactions represent a double digit multiple relative to 2018 EBITDA.
Fernando A. Gonzalez, CEO of Cemex, says: “We remain completely committed towards the goal of achieving an investment grade capital structure and will continue our disciplined deleveraging and improvement of our capital structure.”
For transactions that have closed, the proceeds were used for general corporate purposes, including debt reduction. Meanwhile, the proceeds of transactions which have not closed are expected to be obtained from these divestments and would be mainly used for debt reduction and general corporate purposes.
In relation to divestments that have been announced but not closed, the closing of the announced sales is subject to finalising definite sale agreements and/or the satisfaction of standard conditions for this type of transactions, which includes authorisation by regulators.