Cemex ups offer in TCL takeover bid
The Mexican multinational building materials company Cemex is ramping up its efforts to takeover Trinidad Cement Limited (TCL).
Through its indirect subsidiary Sierra Trading, Cemex increased its offer to TCL shareholders in a change and variation notice Monday.
The company is seeking to acquire up to 132,616,942 ordinary shares in TCL, which together with Sierra’s existing shares of approximately 39.5 per cent, would result in Sierra holding up to 74.9 per cent of the equity share capital in the Trinidad-based company.
On December 5, 2016, Cemex offered a bid of $4.50 (US$0.72) in cash per TCL share, which would have resulted in cash payment of approximately TT$597 million (US$89 million) had there been full acceptance of the offer.
That proposed offer price represented a 33.13 per cent premium over TCL’s price of $3.38 at the close of trading that week.
The offer, it said then, would be conditional on Sierra acquiring at least an amount of TCL shares that would allow Cemex to consolidate the local company. Unless extended, the offer period was expected to close on January 10.
However, in a notice today Cemex said pursuant to the amended offer, Sierra would now offer TT$5.07 in cash per TCL share, adding that except for shareholders of TCL in Barbados, shareholders would have the option to be paid for their TCL shares in Trinidad and Tobago or US dollars.
Full acceptance of the new offer would result in a cash payment by Sierra of approximately TT$672 million (US$101 million).
“The revised offer price represents a premium of 50 per cent over the December 1, 2016 closing price of TCL’s shares in the Trinidad and Tobago Stock Exchange,” the notice said.
The company said the offer was expected to close on January 24, 2017 at 3 p.m., and “Sierra does not currently expect to extend the offer period” after that date. All other terms and conditions of the offer not modified by the amended offer remain unchanged.
If the offer is successful TCL would be consolidated by Cemex “for financial reporting purposes”, it said.
“If the offer, as amended by the amended offer, is successful TCL will continue operating as usual. Additionally, TCL will be maintained as a public listed company on the Trinidad and Tobago Stock Exchange with the benefit of a strong local shareholding together with the enhanced benefit of proven management and operational expertise from Cemex,” it added.
TCL’s main operations are in Trinidad and Tobago, Jamaica and Barbados. TCL is the majority shareholder of Caribbean Cement Company Limited, a main cement producer in Jamaica.