Brazil’s Companhia Nacional de Cimento (CNC) has hired Martinelli Advogados to buy Irish building material producer CRH Group’s cement business in Brazil for US$218 million.
CRH Group relied on Demarest Advogados for the deal, which was announced on 26 October.
The transaction is subject to approval by Brazil’s antitrust authority CADE. Once complete, it will hand CNC three production factories in the states of Minas Gerais and Rio de Janeiro, as well as two grinding plants in Minas Gerais.
The divestment is part of CRH Group’s strategy to focus on the European and North American markets. It acquired the Brazilian assets in 2015 as part of a massive global deal, worth some US$7 billion.
The covid-19 pandemic has had a negative impact on Brazilian cement sales, with construction coming to a halt in March and April, but trade started to recover in May. National cement industry union SNIC recently reported that cement sales were up 24% in June compared to the same month last year, driven mainly by residential and commercial construction and work resuming on real estate projects. Altogether, cement sales were up 3.6% during the first half of 2020 on last year.
CNC is owned by Brazil’s Grupo Ricardo Brennand and Italian cement producer Buzzi Unicem, through their joint venture BCPAR. The Italian company bought a 50% stake in BCPAR in 2018 for US$171 million.
The deal makes Brazil the fifth largest market for Buzzi Unicem, after Italy, the US, Mexico and Germany.
Counsel to Companhia Nacional de Cimento
Partner Luciana Felisbino and associates Caetano Antunes and Rachel Loschiavo
Counsel to CRH Group
Partners Paulo Coelho da Rocha, Paola Pugliese and Milena Mundim, and associates Fernanda Stefanelo, Henrique Rodrigues Anders, Izabella Reis and Marcelo Peloso