San Miguel eyeing majority stake in Cojuangco’s cement firm

Aya Lowe
San Miguel is looking to raise its stake in Northern Cement Corp. to majority as part of its diversification program

CEMENTING THE DEAL Ramon Ang said he is looking to increase his stake in Northern Cement Corp. Photo by Aya Lowe/Rappler

MANILA, Philippines – Ramon Ang-led San Miguel Corp. (SMC) wants to raise its stake in Northern Cement Corp. to majority as part of its diversification program.

“We are hoping to gain majority stake (in Northern Cement) within the year,” Ang, SMC president and COO, said in a press briefing after San Miguel Brewery Inc.’s annual stockholders’ meeting on Thursday, July 11. San Miguel Brewery is a unit of SMC.

SMC earlier shelled out P3 billion in fresh equity for a 35% stake in Northern Cement, which is controlled by SMC chairman Eduardo “Danding” Cojuangco Jr.

Ang managed and turned the cement company around when Cojuangco was in exile after former President Ferdinand Marcos was ousted in 1986. Cojuangco was an ally of Marcos.  

Together with Eagle Cement Corp., which is privately owned by Ang, the SMC group is aiming to have a capacity of 10 million metric tons (MT) of cement over the next 2 to 3 years. The group’s current capacity is 4 million MT.

SMC is pouring as much as $750 million to add another 2 million MT to Northern Cement’s capacity. Northern Cement has a plant in Pangasinan, and 2 new plants will be constructed in Quezon and Cebu. 

“The reason why we are investing is because there are no other cement plants put up in this country since 1997. That’s about 16 years ago. It’s very timely,” said Ang.

SMC prevoiusly announced its intention to go full blast in its expansion into the extractive industry investing heavily in the cement and mining businesses. The conglomerate has been bullish about the local cement industry as the Philippines has a per capita consumption of 170 kilos, far lower than the per capita consumption of 1,000 kilos in other countries.

SMC said it intends to put up at least 5 more cement plants all over the Philippines in the next 5 years.

Diversification mode

Ang said the company is still on diversification mode even after making significant investments in mining, power generation and distribution, oil retailing, telecommunications and infrastructure.

“We are still pursing diversification. If there are good opportunities that would give good returns, we will definitely pursue [them],” Ang said.

Ang said they would get new investors for the banking and power generation businesses. He said many foreign and local banks have signified interest to invest in Bank of Commerce and SMC Global Power Holdings Inc.
Ang said SMC would sell up to 49% of the power unit within the year, and around 40% of Bank of Commerce.

For the power unit, Ang said SMC may hold an initial public offering or sign a private placement deal, depending on market conditions.

“We will definitely sell 49% of SMC Global before the end of the year,” he noted. –



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