Rinker Cements Us Deals
The Age
Tuesday January 30, 2007
AUSTRALIAN-BASED Rinker is continuing to make the most of the downturn in the North American building materials and housing markets by snapping up two more US concrete manufacturers.
The moves come as Rinker's independence is at risk from a $17 billion takeover bid from Mexican cement maker Cemex. The purchase of separate operators in the western state of Utah and Tennessee in the south-east takes the number of acquisitions by Rinker's main subsidiary to five since Cemex emerged as a hostile bidder for the Australian parent company in October. Analysts estimate that Rinker has now spent close to $100 million on buying American businesses as it awaits the next step in its prolonged takeover fight with Cemex. The hostile bid was last week extended by a further two months to March 30, as US regulators examine likely competition concerns of merging the two companies. The same slump in Rinker's main market, where it earns 80 per cent of its profits, is driving its push to buy further quarrying, aggregate and concrete operators. More "bolt-on" purchases are likely as sellers lower their price expectations in the wake of a slump that has gripped the housing industry. Rinker and Cemex will reveal today how well they are weathering the US downturn with the release of their latest quarterly results. Rinker shares gained 2? to $18.28 yesterday.
© 2007 The Age
