3i eyes HeidelbergCement assets

The UK-based firm may bid for the company's Malaysian assets, estimated to be worth more than $200m. Others reportedly interested include Bain and CVC.

London-listed 3i Group is interested in acquiring  HeidelbergCement’s Malaysian assets, a source has confirmed.

Bain Capital and CVC Capital Partners have also reportedly has expressed interest in the assets, which are worth at least $200 million, people familiar with the deal told Dow Jones.

CVC and Bain did not respond to a request for comment. 3i declined to comment.

Germany-based HeidelbergCement is one of the world’s largest manufacturers of building materials, active in the areas of cement, concrete and other downstream activities. It has a presence in about 50 countries worldwide.

The company has been active in Malaysia since its acquisition of UK-based building materials supplier Hanson for approximately £8 billion in August 2007. It operates 40 ready-mixed concrete plants, 17 aggregate quarries and 20 asphalt plants in the country.

HeidelbergCement is divesting non-core assets to raise capital to meet its debt obligations resulting from its acquisition of Hanson two years ago. Yesterday, it announced the sale of its assets in Israel for an estimated €120 million.

“The proceeds from the disposal will contribute to HeidelbergCement’s deleveraging and debt reduction,” Bernd Scheifele, chairman of the company, said of the sale of its Israel operations. “For the further reduction of its debt HeidelbergCement will continue to focus on its divestment programme of non-stategic business units,” he added.

Last month, HeidelbergCement sold 14.1 percent of the 65.1 percent stake it holds in Indonesian cement producer PT Indocement Tunggal Prakarsa for €220 million. In May, HeidelbergCement sold its asphalt operating line in Australia. 

In January, the Wall Street Journal reported that TPG and Goldman Sachs were together considering buying a minority stake in the German cement conglomerate, as was PAI Partners.