ICG subsidiary acquires cement-related assets in Kazakhstan

MAINBOARD-LISTED International Cement Group (ICG) has announced that its subsidiary Sharcem has entered into a sale and purchase agreement to acquire cement-related assets in Kazakhstan on an "as-is" condition.

In an exchange filing on Monday, ICG - a cement producer with operations in Central Asia - said it is acquiring the assets from Kazakhcement and Development Bank of Kazakhstan.

The purchase consideration of around 7.07 billion Kazakhstan tenge (S$22.1 million) will be payable in two cash instalments. The amount will  come from internal sources and third-party financing, ICG said.

Key assets in the sale and purchase agreement include seven land plots with a total size of 125ha and objects located on these land plots - which include dormitories, railway tracks and facilities for the cement plant.

ICG said the proposed acquisition presents an "attractive opportunity" for the group to establish a stronger foothold in Central Asia, where demand for cement remains strong.

It added that the acquisition of the assets will grow its current annual cement production capacity by one million tonnes to four million tonnes in total.

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The acquisition is expected to be completed by May 31, 2021, and is conditional upon Kazakhcement completing the transfer of all assets to Sharcem, and the sellers removing all liens and encumbrances on the assets.

Sharcem is 60 per cent owned by ICG's wholly-owned subsidiary International Cement Shar. The remaining 40 per cent is held by an individual, Nurzhan Shakirov, who is the local partner for ICG's existing cement plant in Kazakhstan, Alacem.

ICG's substantial shareholders as at March 16, 2021 were its non-independent and non-executive director Zhang Zengtao, and its chairman and executive director Ma Zhaoyang. They collectively had deemed interest in over 80 per cent of ICG's shares.

ICG's shares fell 1.8 per cent or 0.1 Singapore cent on Monday to close at 5.6 cents, before the announcement.