UltraTech re-evaluating Brazil asset bid

Indian cement major UltraTech Cement is reportedly re-evaluating its decision to bid for the Brazilian assets put on the block by Holcim and Lafarge ahead of their planned merger.

According to local press reports, the Aditya Birla company had submitted non-binding bids for the cement assets in October, after which binding bids are due in January. The company is now said to be “rethinking about the bids” and UltraTech Cement may “pull back at the binding stage,” sources familiar with the matter told MINT.

The Brazilian assets on sale include three integrated cement plants and two grinding stations that share a total capacity of 3.6Mta. There is also one ready-mix plant. The decision to re-think the Brazilian investment may stem from weak demand conditions in the market. UltraTech is now reportedly planning to focus and expand its domestic cement production, according to the news report.

Earlier this week, Cementos Argos of Colombia also withdrew its interest in the Brazilian assets, informing the Superintendencia Financiera that it does not see such a purchase as being likely to generate the value its investments would expect.