Holcim, NZ Steel sell lime business to Canada's Graymont
Holcim has been trying to sell the lime business, which it no longer considers a core business, as it plans for imported cement to replace local production at Westport.
Hot Topic
Hawke’s Bay
Graymont, the Canadian lime business, has agreed to buy McDonalds Lime from Holcim New Zealand, which plans to close its Westport cement plant in 2016, and Bluescope Steel-owned New Zealand Steel for an undisclosed sum.
The local operations of the international cement company will also sell its Taylor's Lime assets to Graymont, the companies said in a joint statement. McDonalds Lime is 72 percent owned by Holcim NZ, with the remainder owned by NZ Steel, and has the country's largest lime quarry at Oparure, north of Te Kuiti.
Graymont is North America's second largest supplier of lime and lime-based products, and has an investment in Grupo Calidra, Mexico's largest lime producer, it said. This is the Canadian company's first investment in the New Zealand market.
Holcim has been trying to sell the lime business, which it no longer considers a core business, as it plans for imported cement to replace local production at Westport.
It wrote down the value of its Westport cement plant ahead of the coming closure, booking $31 million of charges for the plant, comprising a $23 million impairment and $8 million project cost writedown, the accounts for the New Zealand holding company, Fernhoff Ltd, for the year to Dec. 31, 2013 filed to the Companies Office in July show.
The plant will close by the second half of 2016 when new import facilities at Waitemata in Auckland and Timaru costing $100 million are fully operational. Plans for a new cement manufacturing plant at Weston in North Otago remain on hold but the company is keeping the assets so it has the option of "eventually building a new cement plant".
The McDonald's sale is subject to regulatory approvals and should be completed in 2015, Holcim and Graymont said.
(BusinessDesk)
Suze Metherell
Mon, 15 Dec 2014
Mon, 15 Dec 2014
© All content copyright NBR. Do not reproduce in any form without permission, even if you have a paid subscription.
Holcim, NZ Steel sell lime business to Canada's Graymont
43965