23 November 2006

HeidelbergCement expands network in Caucasus region and on the Caspian Sea

  • Majority participation in Georgia
  • Construction of new plant in western Kazakhstan

HeidelbergCement has signed an agreement to acquire a share of 75% in the Georgian cement company Saqcementi. The company which is the largest cement producer in the Caucasus region operates two cement plants near the capital Tbilisi. The wet process plants are in good technical condition and have a total capacity of 1.6 million tonnes of cement. Saqcementi is the market leader in Georgia with a share of around 60% and, in addition, supplies neighbouring Azerbaijan (market share of around 20%) and Armenia. This acquisition ideally complements our participation in Kartuli Cementi, which we acquired in May this year.

In western Kazakhstan, HeidelbergCement plans to construct a new cement plant with a capacity of 2 million tonnes, with the support of the Kazakh government. The plant will supply the boom region on the Caspian Sea as well as neighbouring markets in Uzbekistan, Turkmenistan and Azerbaijan. These countries are suffering from an significant cement shortage. In addition, the new production site will relieve the strain on our plant in eastern Kazakhstan, which until now has delivered considerable quantities over a distance of more than 3,000 km to the west of the country.

HeidelbergCement’s locations in Ukraine – particularly Doncement –, its locations in Georgia and the new plant in western Kazakhstan form an efficient network for supplying the markets around the Caspian Sea. With its large oil and gas deposits, we expect strong economic growth, heavy investment in expanding infrastructure and a significant increase in cement consumption in this region.

"We want to benefit from the growth potential of this rapidly growing market and establish a strong market position”, explains Dr. Bernd Scheifele, Chairman of the

Managing Board of HeidelbergCement. “The expansion in Georgia and Kazakhstan is another important step in extending our entire network in Eastern Europe and Central Asia.”

Caption: Kartuli Cementi in Georgia, part of HeidelbergCement’s network of efficient production sites in Eastern Europe and Central Asia.

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Andreas Schaller

Group Spokesman, Director Group Communication & Investor Relations
+49 6221 481 13249
+49 6221 481 13217
HeidelbergCement AG
Berliner Straße 6
69120 Heidelberg