SCG raises stake in Philippine company
Siam Cement Group's strategy to build up its assets in Asean took another step with the raising of its stake from about 40 per cent to more than 50 per cent in a Philippine construction-materials supplier.
“We expect the deal to be announced in the first half of this year,” Kan Trakulhoon, president and chief executive officer of Thailand’s largest industrial conglomerate, said yesterday.
SCG also expects to finalise by the end of this year a project in Burma to construct a cement plant with production capacity of 1.9 million tonnes per year, he said on the sidelines of the Asean Business Forum held by the Thailand Management Association.
Now SCG’s holding in the Philippine company, which is the leader of its industry, is significant, but cannot be revealed until the deal is formally disclosed.
About 24 per cent of SCG’s employees are working outside Thailand, including local staff of companies that SCG has acquired.
Employees working in Asean ex-Thailand will grow to 26 per cent with the latest deal, while the company’s Asean assets will increase from US$1.6 billion (Bt49 billion) currently, which accounts for 13 per cent SCG’s total assets.
The cement plant in Burma, which is 300 kilometres from Rangoon, would require an investment of more than Bt10 billion.
Financing for the petrochemical complex in Vietnam should be arranged by the first quarter of next year after the company signed a shareholding agreement with its partners over the past few weeks.
Construction can start immediately once the financing package is in place.
“The investment of $4.5 billion is very big amid the ongoing global economic crisis. The financial situation in Europe is still weak, while Japan still needs a lot of money for recovery after the tsunami devastation last year. So it is difficult to conclude the project financing this year,” he added.
