Dec 2016 Financial News

Fitch: Cemex buyout good for TCL

Dec 07, 2016

International ratings agency Fitch says a meaningful increase in Cemex’s current indirect 39.5 per cent ownership of Trinidad Cement Ltd (TCL) would be a positive ratings trigger.

The Mexican company recently announced its intention to make an offer and takeover bid to shareholders of TCL for up to 132.6 million ordinary shares in the Claxton Bay cement plant.

If successful, the offer will increase Cemex’s current indirect stake on TCL to up to 74.9 per cent and could result in an upgrade of at least one notch to TCL’s ‘B-’ rating. The offer is conditional on Cemex indirectly acquiring an amount of TCL shares that would allow it to consolidate the company. The offer is expected to close on January 10, 2017.

TCL is the leading producer of cement in Caricom, with eight operating companies in T&T, Barbados, Guyana, Jamaica and Anguilla. It has a dominant market position, particularly in key markets such as T&T and Jamaica.

As of September 30, TCL had generated US$77 million of earnings before interest, taxes, depreciation, and amortization and its total debt was US$161 million.

Fitch says the company’s US$47 million in cash adequately covers US$29 million on short-term debt as of the third-quarter 2016.

Cemex previously made two bids to take over TCL in 2002 BUT both offers were rejected by then CEO Dr Rollin Bertrand.

Source:
Trinidad Guardian
Wednesday December 7, 2016

http://www.guardian.co.tt/business/2016-12-06/fitch-cemex-buyout-good-tcl