MANILA, Philippines – From its origins as a Mexican multinational investment, CEMEX Holdings Philippines (CEMEX) is now majority-owned by Filipino conglomerate Consunji Group, known for building landmarks such as the Cultural Center of the Philippines, Manila Hotel, as well as its projects under DMCI Homes.
Engineering conglomerate DMCI, founded by the late Filipino engineer David M. Consunji in 1954 or 70 years ago, announced on Tuesday, December 3, that it had “successfully completed” its acquisition of Cemex Asian South East Asian Corporation (CASEC) for $272 million or P15.9 billion. CASEC owns 90% of CEMEX Philippines. The purchase is the Consunji group’s largest acquisition.
READ: The simple life of David M. Consunji
DMCI is now led by David’s son, 76-year-old Isidro or “Sid,” a product of the University of the Philippines (UP) College of Engineering.
CEMEX, the country’s fourth-largest cement manufacturer, started operating in the Philippines in 1997 or during the Ramos administration. Prior to DMCI’s takeover, its president and CEO was Mexican Luis Guillermo Carillo.
In the construction industry, CEMEX is known for its brands CEMEX APO Cement and CEMEX Rizal Cement. It operates cement factories in Tina-an, Naga in Cebu in central Philippines and in Barangay San Jose, Antipolo City, Rizal, east of Metro Manila.
DMCI Holdings said in a stock exchange disclosure that its 90% ownership of CEMEX Holdings marks its “strategic expansion into the cement manufacturing sector.”
Cemex is a global construction materials company based in Mexico that offers cement, ready-mix concrete, and aggregates (such as gravel, sand, crushed rock) in markets around the world.
“We are excited to welcome CEMEX Holdings Philippines into the DMCI group,” said Sid Consunji. “This acquisition aligns with our core expertise in engineering and construction and dedication to contributing to the infrastructure development of the Philippines.”
Apo Cement and Solid Cement currently have a combined annual production capacity of 5.7 million tons. DMCI expects this to grow to 7.2 million tons by early 2025 with the expansion plant of Solid Cement in Antipolo.
DMCI Mining Corporation (DMC) executive vice president and chief finance officer Herbert Consunji, a cousin of Sid, was appointed president and CEO of CEMEX Holdings Philippines to “ensure a seamless transition.”
Herbert “will lead turnaround efforts to further streamline operations and unlock synergies” for the group, DMCI Holdings said.
“Our priorities are to enhance the logistics network, optimize the product mix, manage production and operating costs, and leverage on potential operating synergies within the DMCI ecosystem,” said Herbert.
DMCI Holdings said the acquistion is seen to strengthen it “with captured markets for coal, long-term contracted power capacity, fly ash, and cement products.” It expects CEMEX’s operational costs to decrease as it transitions to buying coal from DMCI’s Semirara Mining and Power Corporation (SMPC) for its energy needs, while boosting SMPC’s coal sales. DMCI and DMCI Homes will also be sourcing around 400,000 metric tons of cement from CEMEX.
CEMEX Philippines reported losses of P1 billion in 2022 and P2 billion in 2023 due to escalating costs and lower sales.
Cemex announced from Mexico last April that it would divest its operations in the Philippines, selling Cemex Asia B.V. to the Consunji group. Included in the sale was its 40% indirect equity interest in APO Land and Quarry Corporation and in Island Quarry and Aggregates Corporation.
“Proceeds from this divestment are expected to be used to fund the company’s bolt-on investment growth strategy in its key markets, reduce debt, and for other corporate purposes,” Cemex Global had said.
Philippine business group Management Association of the Philippines (MAP) picked Sid Consunji as its Management Man of the Year in 2022 for his “business acumen and management qualities in transforming a private construction firm into one of the Philippines’ biggest and most resilient conglomerates.”
He was also cited for his leadership role in the Consunji group’s “contributions to national development, job creation and income generation through huge investments in construction, real estate, mining, energy and water distribution.”
Among the companies in the Consunji Group are: property developer DMCI Homes with over 72,000 units sold; DMCI Power Corporation with an installed capacity of 144.8 megawatts; Semirara Mining and Power Corporation, the country’s biggest coal producer; nickel producer-exporter DMCI Mining Corporation, plus a minority interest in Maynilad Water Services.
Other landmarks built by DMCI are the Philippine International Convention Center and Folk Arts Theater in Pasay City, the Church of the Holy Sacrifice in UP Diliman, Quezon City, and the Istana Nurul Iman Palace, the largest residential family residence in Brunei. – Rappler.com
