Votorantim, Camargo Said to Be in Talks to Buy Rest of Cement Maker Cimpor

Brazilian holding companies Votorantim Participacoes SA and Camargo Correa SA are in talks to buy a remaining stake in cement maker Cimpor-Cimentos de Portugal SGPS SA (CPR), said two people familiar with the negotiations.

Camargo plans to take over Cimpor’s operations in Brazil, while Votorantim would consolidate assets of the Lisbon-based company outside of Brazil, said one of the people, who declined to be identified because the transaction is private. The Sao Paulo-based companies already own about 54 percent of Cimpor, according to data compiled by Bloomberg.

The value of the remaining stake is about 1.5 billion euros ($2.1 billion) based on Cimpor’s Oct. 19 closing share price. Votorantim and Camargo acquired control of the Portuguese cement maker in February 2010 after beating an offer from Cia. Siderurgica Nacional SA.

Cimpor shares climbed as much as 6.2 percent in Lisbon trading to 5.30 euros, and were up 4.5 percent as of 9:08 a.m. in the Portuguese capital. Cimpor had dropped 1.6 percent this year through yesterday, compared with a 21 percent decline for Portugal’s benchmark stock PSI-20 index. (PSI20)

“Investors who hold Cimpor shares are expecting a higher price if there is a takeover and those who don’t own Cimpor shares will probably like to buy some,” said Juan Dieste, a trader at Orey iTrade in Lisbon.
Largest Investors

Cimpor’s biggest shareholders after Camargo and Votorantim are Manuel Fino SGPS SA, with a 10.7 percent stake, Banco Comercial Portugues SA’s employee pension fund, with 10 percent, and Caixa Geral de Depositos, with 9.6 percent, according to data compiled by Bloomberg.

In February, Brazil’s Finance Ministry recommended that the antitrust agency approve Votorantim and Camargo’s stakes in Cimpor with some restrictions, including the sale of some assets.

The talks with Cimpor shareholders could break down and there is no guarantee a deal will be reached.

Mafalda Correia, a spokeswoman for Cimpor, declined to comment. An official for Votorantim declined to comment, and officials at Camargo didn’t immediately return calls seeking comment.