The joint venture will be owned by Votorantim Cimentos International (VCI) and long-term institutional investor Caisse de dépôt et placement du Québec (CDPQ), through its investment in McInnis Holding. VCI is the international investments platform and wholly owned subsidiary of Votorantim Cimentos S.A., which claims to be the sixth largest cement producer in the world.
The partners say the business combination should significantly strengthen the strategic positioning of the combined operations through increased cement production capacity, operational efficiencies and an enhanced distribution network.
Votorantim Cimentos International will hold 83% and CDPQ will hold 17% of the shares in the joint venture. Both parties will transfer North American assets to the combined entity. The Votorantim Cimentos assets are primarily cement plants located in Bowmanville and St. Marys, in Canada, and in Detroit and Charlevoix, Michigan, and Dixon, Illinois, in the US, along with its extensive distribution network concentrated in the Great Lakes region.
The McInnis Cement assets include the Port-Daniel-Gascons plant with all of its terminals located in Quebec, Ontario, New Brunswick, Nova Scotia and the Northeastern region of the United States, as well as its maritime operations.
Marcelo Castelli, global CEO of Votorantim Cimentos, commented: “This transaction is aligned with Votorantim Cimentos’ portfolio management strategy, prioritising investments in markets in which we already operate and enabling geographic expansion in locations with attractive growth prospects. McInnis Cement’s state-of-the-art plant and distribution network enable an efficient cost position in an attractive region, with access to new markets and lots of opportunities."
Kim Thomassin, CDPQ’s executive VP and head of investments in Quebec and stewardship investing, added: “The creation of this combined entity allows us to partner with a world-class player with an established presence – and strong track record of profitability – in North America to operate the McInnis Cement plant in Port-Daniel-Gascons, one of the most modern and efficient facilities in the region. This partnership will enable the Port-Daniel-Gascons plant to benefit from Votorantim Cimentos’ production, distribution and operational expertise to develop important markets, particularly in Eastern Canada, the Great Lakes region and the Northeastern Coast of the United States to meet the growing demand for cement."
The partners say that, with a growing demand for the development of critical infrastructure throughout North America – and an emphasis on new large-scale projects to drive the economic recovery– the market outlook for cement remains positive.
McInnis Cement adds that its 2.2-million-tonne annual capacity plant in Port-Daniel-Gascons, Canada is the first new plant built to serve Eastern Canada, the Northeastern US and the Great Lakes region in more than 50 years – complementing St. Marys Cement’s longstanding presence in the region. McInnis Cement has constructed a deep-water marine terminal, adjacent to the plant, and operates three marine vessels and a distribution network consisting of 10 terminals (marine, rail and truck) strategically located in the U.S. and Canada.
Founded in 1933, Votorantim Cimentos is a global company operating in building materials, mining, agricultural lime, co-processing and waste management. With 256 industrial sites worldwide, the company has an installed cement capacity of 52.8 million tonnes.
Votorantim Cimentos’ presence in North America began in 2001 with the acquisition of St. Marys Cement. Through its integrated cement plants in St. Marys and Bowmanville, Ontario, and Detroit and Charlevoix, Michigan, St. Marys Cement currently serves Canadian and US customers in the Great Lakes region. With a production capacity of 5.2 million tonnes, St. Marys Cement participated in such landmark projects as the CN Tower, Roy Thompson Hall, Maple Leaf Gardens and the Darlington Nuclear Station, in addition to many other engineering, civic and residential projects.