Coal news and updates

1. Elementia paid US$220 million for a 55% stake and full control of Giant using the proceeds obtained from the capital increase through a Rights Offering, resulting in an implied equity value of US$400 million.

 

2. Elementia granted a loan to Giant for US$305 million through its committed credit lines.

 

3. Giant utilized both resources (totaling US$525 million) to pre-pay 100% of its current debt, as previously agreed between the parties.

 

Is important to highlight that given the volatility of the currency exchange, the Company hedged the resources from the capital increase and the loan granted to Giant at a rate of close to $19 Mexican pesos per dollar.

 

The debt replacement will reduce Giant’s financial cost by more than 75%, which will free up sufficient cash flow to execute the investments required to capture the many opportunities Elementia foresees and thus, generate the expected additional value.

 

With this transaction, Elementia adds over 2.8 million tons of cement production capacity per year through three cement plants, three limestone quarries, two aggregate quarries and six cement terminals, along with a solid customer base and reputable brands such as Keystone, Dragon, Giant, and Grr!

 

Fernando Ruiz Jacques, Chief Executive Officer of Elementia, commented, “Today marks a major milestone for Elementia as we successfully enter the U.S. cement market and take another solid step within our inorganic growth strategy. The work of our transition team is already underway to extract the tremendous value we see in Giant.”

Source: Business Wire