Del Rosario-led PHINMA Corporation's (PHN) subsidiary Philcement Corporation is buying 100 percent of Petra Cement Inc., which is controlled by tycoon Henry Sy Jr., for P500 million.
In a disclosure to the Philippine Stock Exchange (PSE), PHINMA said it has signed Tuesday, May 21, a Share Purchase Agreement with Petra through Philcement Mindanao Corporation, a subsidiary of Philcement. The transaction is expected to be closed by Dec. 31, 2024.
This follows the signing of a Manufacturing and Sale Agreement between Philcement and Petra last Jan. 12, 2024 to enable Philcement to operate the Petra Plant, and to manufacture and produce, distribute and sell cement products. The Petra Plant is located in President Manuel A. Roxas, Zamboanga del Norte.
“This is aligned with Philcement’s growth strategy and its promise to assure Filipino consumers with reliable, high quality supply of cement products under its legacy brand, Union Cement,” PHINMA said.
Philcement Corporation, a 60 percent owned subsidiary of PHINMA Corporation, is engaged in the manufacture, importation, processing, distribution, and sale of cement products. It currently operates a cement processing facility in the Freeport Area of Bataan in Mariveles.
Philcement Mindanao Corporation is a 70 percent-owned subsidiary of Philcement Corporation.
PHINMA is expanding its cement business in Mindanao with the planned acquisition of Petra Cement’s plant Zamboanga del Norte as well as the construction of new facilities in Davao.
According to PHINMA Executive Vice President for Construction Materials Group Eduardo A. Sahagun, the acquisition of the Petra Cement plant will make PHINMA the only cement company serving Northern Mindanao.
Petra Cement is the sister company of Big Boss Cement which was founded by its President Gilbert Cruz and counts Henry Sy Jr. among its top investors.
The Petra Plant comprises a cement grinding facility with a capacity of 500,000 metric tons per annum.
“We actually look at that as an opportunity. When we look at where it is located, it’s almost like we’re the only one there serving northern Mindanao. We think that has a good potential for us. And bring us closer to where we want to be as we actually put together our model for being more sustainable for our cement business,” Sahagun said.
The acquisition will complement the 1.5 million ton per year cement packaging plant PHINMA plans to put up in Davao. Currently PHINMA has a processing plant in Mariveles, Bataan.
“That will bring our total capacity to somewhere like 5 million tons if all those things will be completed in a couple of years,” said Sahagun.
Meanwhile, Sahagun said, “the Davao plant is about to start. We’re just working on its environmental clearance certificate.”
The Davao plant, a joint venture with local partners, is estimated to cost about P2 billion and will be funded by a combination of equity from the joint venture partners and some debt.