Heidelberger plans to acquire Indocement

Heidelberger plans to acquire Indocement

FRANKFURT (AFX): Heidelberg Zement AG said it reached an agreement with the Indonesian government and three other Indonesian parties to acquire the country's second largest cement producer PT Indocement Tunggal Prakarsa TbK.

A statement issued here said the agreement, signed end- December, was also with Indonesia's IBRA, the state-run agency in charge of restructuring financial institutions, as well as the two companies PT Mekar Perkasa and PT Kaolin Indah Utama.

It said the acquisition will take place in three stages, which comprise the sale of shares held by IBRA, Mekar and Kaolin, the exercise of a rights issue as well as the conversion of Indocement debts to be absorbed by Heidelberger into equity worth about US$150 million.

Heidelberger's spokesman was not immediately available to clarify details.

The deal is expected to be closed end-March, the statement said.

It said Indocement's debts will be absorbed by Heidelberger and a debt restructuring plan will be implemented.

It said Heidelberger will temporarily not consolidate Indocement in its books.

The acquisition will be carried out through the financial holding Heidelberger Zement South-East Asia, a joint venture between Heidelberger and its German financial partners, which were not named in the statement.

This holding will hold more than 50 percent of Indocement shares after the closing of the agreement, it said.

It said Indocement, Indonesia's second largest cement producer, has three plants with total capacity of 15.8 million tons.

The acquisition will increase Heidelberger's cement capacity by 25 percent and significantly increase its position in Asia, it added.