Holcim Ltd. (HOLN), the world’s second- largest cement maker, fell the most in three weeks in Zurich trading after it sold a 1.5 percent stake for 296 million Swiss francs ($327 million) to improve its finances.
The shares were priced at 59.25 francs a share in the private placement, the Zurich-based company said in a statement today. Holcim stock fell as much as 3 percent, the biggest intraday decline since March 6, and traded 2.7 percent lower at 59.50 francs at 10:22 a.m.
“This is management tapping Holcim’s full valuation to de- gear,” Ian Osburn, an analyst at ING Wholesale Banking, wrote in an e-mailed note, adding it’s a “bearish signal” for the stock. He has a “sell” recommendation on Holcim.
Holcim’s net debt widened 1.6 percent to 11.5 billion francs in 2011. The company’s long-term debt is rated at the second-lowest investment grade at Moody’s Investors Service and Standard & Poor’s. Holcim stock reached an eight-month high of 63.50 francs on March 14.
“We welcome any measures which strengthen Holcim’s balance sheet,” wrote Christian Arnold, an analyst at Bank Vontobel with a “hold” recommendation on the stock. “However, in the short term it will somewhat put a cap on Holcim’s share price.”
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