Fri. Mar 29th, 2024

 
Thai conglomerate Siam Cement Group (SCG) is planning to
acquire in whole or in part another cement plant in Vietnam.
Thai conglomerate Siam Cement Group (SCG) is planning to
acquire in whole or in part another cement plant in Vietnam.

Nikkei Asian Review recently quoted SCG’s president and CEO Roongrote
Rangsiyopash as saying that a joint venture or merger with an existing
plant would be the best way to enter the Vietnamese market because of
the country’s excess capacity.

Earlier, in January, Dhep Vongvanich, SCG Vietnam’s executive
director, said SCG would have another plant in Vietnam, but could not
say when. In March 2012, SCG officially started operation of Buu Long
Industry Investment Joint Stock Company (Buu Long II JSC).
SCG Cement acquired 99% equity of the company in the fourth quarter of
2011.

SCG has plants in Cambodia and Indonesia, and the company is starting
production at plants in Myanmar in the third quarter of 2016 and Laos
in mid-2017.

According to industry insiders, Vietnam’s cement output is estimated
at 81.56 million tonnes, while the consumption in 2016 is estimated at
between 75 and 77 million tones, presenting an oversupply. Later this
year, Song Lam cement producing plant, with the annual capacity of four
million tonnes, is going to open, which is expected to intensify
competition amongst domestic cement manufacturers.

“But public and private construction projects are expected to
increase, given projections from the World Bank that Vietnam’s gross
domestic product will grow at more than 6 per cent for the next three
years,” said Chaovalit Ekabut, SCG’s chief financial officer.

Meanwhile, another cement giant – LafargeHolcim Group, a joint
venture between Swiss Holcim Ltd. and French Lafarge Group – is
restructuring its business in Vietnam due to the domestic oversupply.

LafargeHolcim is currently the largest multinational cement producing
company in the world by installed capacity. In Vietnam LafargeHolcim
has five cement plants and eight ready mixed concrete plants, with an
annual capacity of six million tonnes of cement and one million cubic
meters of concrete per year, and is the largest foreign-invested cement
producing company in Vietnam.

Holcim Vietnam presently holds a 26 per cent of domestic market
share, while Lafarge Vietnam takes another 12 per cent, with their main
products being cement, concrete, and aggregates.

VIR

By vivian