Bloomberg News

Camargo Correa Bids $3.3 Billion for Remaining 67% of Cimpor

March 30, 2012

Camargo Correa SA, a Brazilian cement producer and the biggest investor in Cimpor-Cimentos de Portugal SGPS SA, offered 2.48 billion euros ($3.31 billion) to buy the 67 percent of the Portuguese company it doesn’t already own.

Camargo Correa, through its Intercement Austria subsidiary, bid 5.50 euros a share for outstanding stock in Lisbon-based Cimpor, Intercement said in a filing with the Portuguese securities regulator today.

The offer is a 10 percent premium to Cimpor’s closing price of 5 euros today in Lisbon. Cimpor, Portugal’s largest cement producer, gained 1.4 percent earlier today, after Portuguese newspaper Jornal de Negocios reported Camargo Correa was preparing a bid.

Camargo Correa and rival Votorantim Cimentos SA, both closely held and based in Sao Paulo, bought stakes separately in Cimpor in early 2010. Their actions helped derail a hostile bid for the Portuguese company by Brazilian steelmaker Cia. Siderurgica Nacional SA (CSNA3), or CSN.

Camargo Correa said it seeks control as well as the creation of “a coherent and stable shareholder structure” in Cimpor and aims to combine its South American and Angolan operations with the company, which does business on four continents. While it may buy all of Cimpor’s shares, Camargo Correa said it doesn’t currently intend to end the Portuguese company’s stock-market listing.

Shareholders’ Accord

A Cimpor spokeswoman didn’t answer her mobile phone after business hours and didn’t immediately respond to a text message.

Portuguese state-owned bank Caixa Geral de Depositos SA said in a separate statement today it would sell its 9.6 percent stake to Camargo Correa, provided Caixa and Votorantim agree to end a shareholders’ accord.

Camargo Correa, which has a 33 percent stake, and Votorantim, which has 21 percent, according to data compiled by Bloomberg, held talks last October about buying the rest of Cimpor and dividing its assets, people familiar with the negotiations said at the time. Camargo would keep Cimpor’s Brazilian plants and Votorantim would take the rest, they said.

Votorantim doesn’t plan to top the offer for Cimpor, while it may consider buying a stake in the cement maker and teaming up with Camargo Correa to take control, according to two people familiar with the matter. Votorantim may buy Caixa’s stake under its right of first refusal or decide to sell its existing stake, they said.

In a statement, Votorantim said it will analyze Camargo Correa’s offer and evaluate “all alternatives.”

Brazil accounted for 30 percent of Cimpor’s revenue last year, overtaking the Iberian peninsula as the company’s biggest source of sales. Cimpor also has operations in the Middle East, Africa and Asia.

Brazilian infrastructure spending is increasing as the country prepares to host the 2014 soccer World Cup and the 2016 Olympics. The government has said infrastructure investment of 140 billion reais ($77 billion) will be needed for the two events.

To contact the reporter on this story: Jim Silver in New York at jsilver@bloomberg.net

To contact the editors responsible for this story: Dale Crofts at dcrofts@bloomberg.net; Brad Skillman at bskillman1@bloomberg.net


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