of Huaxin Cement is accelerating, and this time the company has set its sights on the Middle East. On the evening of March 13, Huaxin Cement announced that it intends to acquire 59.58% of a cement manufacturer in Oman, a Middle East country, with a transaction consideration of about $193.1 million (about RMB 1.325 billion).
For many people, Oman is one of the more unfamiliar countries in the Middle East. Oman has a total area of about 310,000 square kilometers and a population of about 4.49 million. The subject of this transaction is Oman Cement Company, an Omani cement manufacturer established in 1983, which has been listed on the relevant exchanges in Oman. The main business of the
company is cement production and sales, with a clinker production capacity of 2.61 million tons per year and a cement production capacity of 3.6 million tons per year, which is also the only clinker plant in northern Oman. The after-tax profits in 2020 and 2021 are about 13.46 million US dollars and 11.55 million US dollars respectively. The acquisition
of Huaxin Cement will be carried out through its wholly-owned subsidiary Huaxin (Hong Kong) International Holdings Limited. The seller of the 59.58% equity of the target company is Investment Authority SPC. The company is a wholly owned subsidiary of the Oman Investment Authority, Oman's sovereign wealth fund, with assets of more than $40 billion.
Huaxin Cement said that the company is one of the earliest cement enterprises in China's building materials industry to go out. This project is a decisive measure for the company to actively promote overseas development strategy, lay out emerging markets and realize rolling development in overseas areas, and is the core layout for the company's development in the Middle East. The successful implementation of this project is the first time that the company and even Chinese cement enterprises have entered the Middle East market.
According to Huaxin Cement, it has nearly 290 subsidiaries in 14 provinces and cities in China and 8 countries overseas, including Tajikistan, Kyrgyzstan, Uzbekistan, Cambodia, Nepal, Tanzania and Malawi , with a cement production capacity of 118 million tons per year. Cement equipment manufacturing 50,000 tons/year, commercial concrete 60.1 million cubic meters/year, etc.
In the semi-annual report of 2022, Huaxin Cement disclosed that the company has laid out more than 12 million tons of annual production capacity in eight countries in Central Asia, Southeast Asia and Africa, and has become the leader of the local cement market in Central Asia. In 2021, Huaxin Cement earned 2.583 billion yuan from overseas, accounting for about 8% of the year's revenue.
Huaxin Cement said that due to Oman's positive market prospects and identifiable synergies and improvement potential, the acquisition will bring considerable economic benefits to the company. In fact, the overseas development cases of
domestic cement enterprises are more than that. In recent years, with the promotion of the "the Belt and Road" initiative, the pace of overseas development of China's cement enterprises has gradually accelerated, and substantial results have been achieved.
According to the list of overseas investment and production released by China Cement Network in 2022, the overseas investment assets of domestic cement enterprises will continue to grow to 46.793 million tons in 2022. Compared with 2021, 2020 and 2019, it increased by 1.767 million tons, 3.619 million tons and 7.51 million tons respectively. Among the production capacity put
into operation, the annual production capacity of overseas clinker of Conch Cement increased by 11.935 million tons, with the largest increment. Followed by Huaxin Cement and Red Lion Group, the annual production capacity of overseas clinker increased by 8.339 million tons and 6.2 million tons respectively. As early as the beginning of the 12th Five-Year Plan
, Conch Group responded to the call of "going out" and invested in Indonesia, Myanmar, Uzbekistan and other countries. The Nanga Project in
Indonesia is the first stop for Conch to expand the overseas market. At the end of 2012, the first pile foundation at the kiln tail of Line A of the project was successfully drilled. On November 18, 2014, the project was ignited and put into operation. The actual construction process took only 21 months. On May 18,
2022, the first project invested by Conch Group in Central Asia, Uzbekistan Karshi Conch Cement Clinker Production Line with a daily output of 3200 tons, was completed and put into operation. On July 30, the production line of 6500 tons of cement clinker per day in Andijan Conch, Uzbekistan, started smoothly. At present
, Conch Group has 43 overseas enterprises in 20 countries and regions, with a global clinker production capacity of 260 million tons, a cement production capacity of 370 million tons, nearly 4500 overseas employees, and a localization rate of 80%. Located in Henghe County, Vientiane Province,
Laos, Red Lion is the first "the Belt and Road" project of Red Lion Group to be completed and put into operation, with a total investment of 300 million US dollars, to build a new dry clinker cement production line with a daily output of 5000 tons, which was put into operation in February 2018, with an annual output of 2 million tons of high-grade cement.
Indonesia Dongjia Red Lion Project is located in Dongkutai County, East Kalimantan Province, Indonesia, with a total investment of 1 billion US dollars. It is planned to build two new dry process clinker cement production lines with a daily output of 10000 tons in two phases. At present, the first phase of the project has entered the stage of equipment installation, and is expected to be ignited and put into operation in May 2023, which is the first overseas cement project of Hongshi Group supporting large-scale wharf.
Red Lion Group actively responds to the national "the Belt and Road" initiative and bases itself on Southeast Asia to build several large-scale cement projects in Laos, Nepal, Indonesia, Myanmar and other countries. At present, Laos Vientiane Red Lion, Nepal Red Lion Hope and Indonesia Renma Red Lion have been completed and put into operation, and Indonesia Tonga, Myanmar Binyang, Nepal Red Lion Hope Phase II and other major projects have been started or carried out "three links and one leveling". The construction of Red Lion's "the Belt and Road" project will realize the coordinated development of enterprises at home and abroad, and also provide a strong impetus for Red Lion to grow into an international first-class green building material enterprise. In February
2022, the commencement ceremony of the 6000t/d clinker cement production line of China West Cement Group Co., Ltd. was held in Andijan, Uzbekistan. After the completion of the project, it will provide 2.2 million tons of high-quality cement for Andijan and its surrounding areas every year, with an annual profit and tax of about 200 billion sum, and promote the rapid development of local related industries, contributing to the economic and social development of Andijan. In September
2021, China signed a contract for Uzbekistan Hengyuan Cement Project, with a total investment of 351 million US dollars, which was jointly acquired by Gezhouba Haitou Company and Gezhouba Cement Company. A cement production line with a daily output of 7500 tons of clinker cement and an annual output of 2.72 million tons of cement has been completed.
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In recent years, a large number of excellent domestic cement enterprises have actively responded to the national "the Belt and Road" initiative, accelerated the pace of going out, and continuously promoted overseas investment. In the future, the pace of outward development of domestic cement enterprises will be further deepened.
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