“Seizing” Business transaction in cement industry

Acquisition of Hoa Phat Cement Plant (Ha Nam) was one of the market share expansion strategies of The Vissai Cement Group (Ninh Binh).

Overview of Vissai 3 Cement Plant (formerly Hoa Phat Cement Plant),
Thanh Liem District, Ha Nam Province

Although costs of this business transaction are not specifically disclosed, ownership of another cement plant will help The Vissai Cement Group raise capacity up to 6.2 million tons/ year.

Discussing a reporter of Vietnam Investment Review, Mr. Nguyen Vu Thanh, Deputy Director General of The Vissai Cement Group stated that with development orientation as a large cement production group, besides new investment to cement projects, The Vissai will balance financial sources and continue to acquire projects having been implemented to promptly increase output.

“Acquisition of the available and well operating production plants and establishments is an important step to push up prompt development in business strategy of The Vissai Cement Group”, emphasized Mr. Thanh.

With capacity of 1.2 million tons cement/ year, construction of Hoa Phat cement plant of Hoa Phat Group was completed in 4/2009 by Bach Dang TMC Investment and Construction Joint Stock Company.

After completing procedures and officially taking over Hoa Phat cement plant, The Vissai Group renamed Vissai 3 Cement Joint Stock Company and inaugurated construction of a cement plant in Thanh Liem District (Ha Nam Province) with total investment of 1,500 billion VND in phase I and capacity of 1 million tons cement/ year. Its commissioning is expected in Quarter I of 2012. This is the forth cement plant of The Vissai Cement Group in North Vietnam.

As planned, The Vissai Cement Group will continue expansion and raise capacity of the existing plants and invest to some projects with high capacity to ensure all cement plants in the Group to equip with advanced technology and modern equipments and satisfy all standards on environmental protection.

Also according to Mr. Thanh in investment plan to strengthen and expand qualifications, in next time, this Group will invest another clinker crushing plant, receive and distribute cement along the coast of Central and South Vietnam, diversify types of cement (PCB30 and PCB40) and produce PC 50 cement products under the purchase orders.

In actual cement consumption decreased since the early year and domestic cement supply exceeding demand, Mr. Thanh said that The Vissai’s domestic consumption for 9 first months of year reduced 20% compared to the same period of 2010 due to impacts of cutting down public investment and standstill of real estate projects, and in turn, the Group signed stable export contract to Bangladesh, Singapore and European market and input of its products was rather good.