FLSmidth will explore the available divestment options for its Cement business to maximise the division’s full potential and strengthen the market leading position of its Mining business.
Over the past year, FLSmidth has simplified and rightsized the Cement business to further strengthen its market-leading position, improve profitability and make it fit-for-purpose with a strategic focus on the core products and services required in the cement industry. The company says it continues to believe that the global economic development and the green transition offer attractive long-term growth opportunities for the Cement business, and that especially the Service business holds significant untapped potential.
To unlock the full potential of the Cement business and to maximise shareholder value, the company assessed different business models, investment scenarios and potential ownership structures. This has led to the company concluding that the Cement business could benefit from an alternative ownership. Consequently, the Board of Directors and Group Executive Management have decided to explore the available divestment options for the Cement business.
Chair of the Board of Directors, Tom Knutzen, says: “I am truly proud of what we have achieved with our Cement business for more than 140 years. I firmly believe the business is well positioned for future success and that it has a significant role to play in the decarbonisation of cement. However, when reviewing the long-term options for FLSmidth as a business, for our customers and for our shareholders, we have concluded that a separation of ownership could be beneficial for both the Mining and Cement businesses. Unlocking the full potential of the Cement business requires substantial investments and dedicated management attention, which we believe will be more easily achieved under a different ownership than FLSmidth’s.”
There is no certainty that any transaction will transpire. Any further announcements will be made as and when appropriate. We would expect a potential transaction to take place by late-2024 at the earliest. In the meantime, FLSmidth Cement will continue to execute on its ‘GREEN’26’ strategy with no changes to leadership or operations.
