Fri, 16 Jun 2006

Cemex ready to drop lawsuit: Report

Mexican cement giant Cemex SA is reportedly insisting on going through with a plan to sell its shares in state-owned cement producer PT Semen Gresik to local diversified business group Rajawali, but would drop its lawsuit against the Indonesian government.

"Cemex insists on selling the stake in Rajawali. In return they will drop the ongoing arbitration process," said a source at the Office of the State Minister of State Enterprises, quoting a Cemex letter sent Thursday to the office.

Cemex recently signed a deal with Rajawali to sell its 24.9 percent stake in Semen Gresik as an exit strategy in a five-year investment dispute with the government. The transaction is subject to the approval of the government, which previously asked Cemex to sell the shares to a consortium of state-owned and local administration-owned companies. -- JP