CRH, the Irish building-materials company, is considering selling its 25% stake in Mashav, the parent company of the Israeli cement monopoly Nesher, industry sources have told TheMarker.
They confirmed a report in Monday’s Irish Independent daily which said the sale was likely after Albert Manifold was recently appointed CEO. Aiming to reshuffle CRH’s global holdings, Manifold put 45 business units the company owns up for sale earlier this year following an asset review.
At this stage there is no indication that a final decision has been made to sell the stake in Mashav, but if the plans do proceed, industry sources have said Access Industries, which is controlled by Ukrainian-born U.S. businessman Leonard Blavatnik and owns the other 75% of Mashav, is the most likely buyer. Israel’s Livnat family or another multinational firm may also have an interest in buying the 25% share.
CRH bought the stake in 2001 for $141 million. Nesher Cement did not provide a response for this report.
The possible change in the ownership mix in Mashav follows talks between Nesher and the government over proposed structural changes in Israel’s cement industry, including opening it to competition. The centerpiece of the plan is the sale of Nesher’s Hartuv plant near Beit Shemesh to a new player in the local industry. The plan is near completion and is likely to be submitted to the cabinet for approval in the coming weeks.
Although some details of the agreement remain to be settled, it is known that in exchange for the sale of the Hartuv facility, the Antitrust Commission would agree to forgo its demand that Nesher stops providing big discounts to its largest customers. The commission assumes that competition would be enough lower cement prices, and such market mechanisms are preferable to price controls or government intervention in the market. In any event, the finance and economy ministries are currently reexamining the price control mechanisms that apply to monopoly industries.
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