CEMEX Announces Plans to Reduce Net Debt By US$162 MM From the Announced Banacci Transaction.Business Editors MONTERREY, Mexico--(BUSINESS WIRE)--May 22, 2001 CEMEX CEMEX Cementos Mexicanos , S.A. de C.V. (NYSE NYSE See: New York Stock Exchange : CX), announced today that it intends to accept the CITIGROUP offer on 1.32% ownership in BANACCI shares. At current BANACCI share market prices, this would amount to approximately US$162 million. This BANACCI position has been held for close to ten years and was bought during the bank privatization privatization: see nationalization. privatization Transfer of government services or assets to the private sector. State-owned assets may be sold to private owners, or statutory restrictions on competition between privately and publicly owned process. The decision to sell this long-term investment, will lead to the recognition of an extraordinary gain of approximately US$130 million during the second quarter of 2001 at current BANACCI market price levels. Rodrigo Trevino, Chief Financial Officer, said: "We view this investment by CITIGROUP as an important vote of confidence in the Mexican economy and its prospects as we converge with our NAFTA NAFTA in full North American Free Trade Agreement Trade pact signed by Canada, the U.S., and Mexico in 1992, which took effect in 1994. Inspired by the success of the European Community in reducing trade barriers among its members, NAFTA created the world's partners. The proceeds from the BANACCI shares will lead to an immediate reduction of net debt of about US$162 million. This transaction will significantly strengthen our capital structure and will allow us to attain our net debt to EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become target sooner than expected. It will also support the execution of our share buyback program. To the best of our knowledge there is no official offer yet and such offer is likely to be subject to legal and regulatory approvals, so there is no assurance at this stage that the transaction will be completed." CEMEX is one of the three largest cement companies in the world, with approximately 78 million metric tons of production capacity. It is also the world's largest trader of cement and its leading producer of white cement. CEMEX is engaged in the production, distribution, marketing, and sale of cement, ready-mix concrete, aggregates, and clinker clink·er n. 1. The incombustible residue, fused into an irregular lump, that remains after the combustion of coal. 2. A partially vitrified brick or a mass of bricks fused together. 3. through operating subsidiaries on four continents. For more information, visit www.cemex.com. |
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion