Gypsum industry news

US: Cemex USA, the US subsidiary of the Mexican building materials company Cemex, has signed an agreement for the sale of its gypsum wallboard business based in Florida to US LBM. Terms of the deal were not disclosed.

The proceeds obtained from this transaction, which Cemex said will not be for a material amount, will be used mainly by Cemex USA's affiliates for debt reduction and for general corporate purposes. Cemex said that the closing of this divestment is subject to the satisfaction of standard conditions for this type of transaction.

The company currently expects to finalise this transaction at any time prior to the end of 2015.

Mexico: Mining and metallurgic production dropped 6% in Mexico in the first four months of 2014, the steepest fall for a similar period since 2009, according to the national institute of statistics and geography (INEGI). The drop was attributed to a fall in coal, gold, iron ore, silver, fluorite and lead production. In contrast, gypsum, coque, sulphur, zinc and copper output rose in the same period.

Germany/Brazil/Mexico: Wacker Chemie AG, the Munich-based gypsum additive producer, is extending its existing technical centre in São Paulo, Brazil, and creating a new technical centre in Mexico City, Mexico. The company will also expand its training centre in São Paulo and open a new one in Mexico City. Both projects have a combined investment of Euro1.2m and are scheduled for completion in the first quarter of 2013.

"Central and South America are key future markets for Wacker. Our sales in these regions have grown by an annual average of 15% over the past five years," said president and CEO Dr Rudolf Staudigl.

World: With Boral's recent acquisition of Sunshine Coast Quarries, the company has spent USD250m in Queensland since April 2011. Boral's head of strategy and mergers and acquisitions, Matt Coren, said this move did not necessarily reveal a special focus on the state (or indeed on cement and concrete), saying, "You'll see us continue to invest in other markets."

Boral's recent acquisition spree, along with Coren's comments, has raised speculation that the group may be eyeing up bigger and more lucrative offshore investments. Following the decision by France's Lafarge to sell 80% of its European gypsum assets to Etex Group (announced on 14 July 2011 – read full story here), the spotlight has again swung to the possibility that Boral may be considering the French gypsum and plaster company's Asia-Pacific and North American assets. Boral and Lafarge have an existing joint venture plasterboard business in Asia and it is thought the Australian building group would like to increase its 50% stake or even buy out its partner entirely.

Credit Suisse has indeed recently labeled Boral as the 'natural owner' of Lafarge's remaining gypsum assets. Rohan Gallagher, an analyst with Credit Suisse said that Boral would need to raise equity to do the deal, but expressed doubt that facilities in the United States and Mexico (including six wallboard plants with over 300Mm2/yr wallboard capacity), would not be a wise choice for Boral in the present climate.

Nomura analyst Simon Thackray said that if Boral could increase its stake in the Asian joint venture by a further 10% and purchase a 60% interest in Lafarge's US business the group would need to spend about USD300m, which could be heavily dilutive.