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SOUTHDOWN TAKES ACTION TO STRENGTHEN FINANCIAL POSITION

 SOUTHDOWN TAKES ACTION TO STRENGTHEN FINANCIAL POSITION
 HOUSTON, Aug. 7 /PRNewswire/ -- Southdown, Inc. (NYSE: SDW)


announced today that its board of directors has approved a plan that would materially strengthen the company's financial condition. Under the plan, Southdown intends to sell up to a 50 percent interest in either its southern California or Florida cement and concrete products operations. Through the contemplated joint venture arrangement Southdown would continue to maintain a significant participation in both of these important markets as the operating venturer. The proceeds from the sale of the joint venture interest will be used to pay down debt, including all outstanding bank borrowings. In addition, the company intends to reduce the size of its bank facility and renegotiate the covenants. Any transaction would be subject to approval from the company's bank group. Southdown will engage Lehman Brothers to assist in the sale.
 Clarence C. Comer, president and chief executive officer of Southdown, stated, "The consummation of the plan will provide Southdown with sufficient liquidity to weather the continuing economic downturn and the position the company to materially enhance shareholders' value during the next upcycle in the construction industry. We remain optimistic about the company's prospects and believe profitability will improve significantly once the pending recovery gains momentum. In addition, Southdown's profitability in the 1990's will benefit from an increase in cement consumption associated with higher levels of infrastructure spending and reduced manufacturing costs resulting from the company's productivity and efficiency improvement programs. The environmental services business, which the company entered in 1990 as a strategic diversification, should also contribute to improved profitability as its development progresses. By reducing leverage and renegotiating its bank agreement, Southdown will strengthen its financial condition and posture itself to take advantage of its favorable long-term prospects."
 As of June 30, 1992, the company's total debt was $351 million and its shareholders' equity was $345 million. The company currently has a $250 million bank facility, of which approximately $100 million was unused as of June 30, 1992. Approximately $66 million was borrowed under the facility on June 30, 1992 and another $84 million was committed under letters of credit or reserved for specific purposes.
 Southdown's California operations consist of a state-of-the-art 1.65 million ton cement plant located 90 miles from Los Angeles, one of the largest ready-mixed concrete operations in Los Angeles and Orange counties and the Azusa aggregate quarry and other aggregate reserves. The company's Florida operations consist of 1.3 million ton cement plant located outside Tampa which is one of the lowest cost plants in the country. In addition, the company owns one of the largest ready-mixed concrete companies in Florida, as well as a sizable concrete block operation. If Southdown is unsuccessful in selling an interest in its California or Florida facilities on favorable terms, the company will pursue other options including the issuance of equity or debt securities.
 Southdown is one of the leading U.S. cement and ready mixed concrete companies. The company manufactures cement in eight plant locations around the country and markets ready-mixed concrete in Florida and southern California. In addition, the company has entered the environmental services business and is engaged in waste processing, recycling and resource recovery.
 -0- 8/7/92
 /CONTACT: James L. Persky or Karen A. Twitchell of Southdown, Inc., 713-650-6200/
 (SDW) CO: Southdown, Inc. ST: Texas IN: CST SU: RCN


LR -- NY015 -- 7930 08/07/92 10:19 EDT
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Publication:PR Newswire
Date:Aug 7, 1992
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