Italcementi has dropped plans to fully acquire its Ciments Français subsidiary after failing to reach an agreement with Ciments Français bondholders in the US.
The company held talks last week with a group of US institutional investors holding US$ 500 million of Ciments Français debt issued in 2002 and 2006. However, it described the conditions set by this group as "excessive and unacceptable" and "not consistent with the purpose of the merger."
Carlo Pesenti, chief executive of Italcementi, issued a long statement in which he was critical of the US investors' stance, and held them responsible for blocking the full takeover of Ciments Français.
"A short-term financial choice prevailed over the long-term vision of an international industrial group that is a leading would player in the sector. The differing interpretation of a clause in an agreement signed by Ciments Français with American institutional investors has not permitted us to reach the goal of the merger," he said.
Although Italcementi could take settle the matter in court, Mr Pesenti ruled-out such litigation. "Despite the comforting opinion of the American legal advisors, we have preferred not to enter into litigation with the American note holders since a transaction as complex as a cross-border merger needs to be carried out following a tight schedule which allows little time for lengthy disputes."