Gypsum industry news

India: Saint-Gobain, which is celebrating its 350th anniversary, has its sights set firmly on the future and, in particular, in India. It entered India in 1996 and now has 20 manufacturing plants and about 4900 employees there.

Saint-Gobain's two ambitions for its businesses in India are to shape the future of and to become the reference for sustainable habitat and to more than double its business in India and to exceed sales of US$1.61bn by 2019.

"India has been an important market and investment destination for Saint-Gobain and, going forward, will be even more so," said Anand Mahajan, Saint-Gobain's general delegate for India, Sri Lanka and Bangladesh.

UK: Saint-Gobain's British Gypsum is making it easier for specifiers and architects to identify environmental performance with the launch of seven new Environmental Product Declarations (EPD) that cover nine products.

As part of its aim to give environmental transparency and make it easier for specifiers to gather evidence for building certification schemes, such as BREEAM, LEED and SKA, British Gypsum has introduced additional EPD to its Thistle plaster range. These include declarations for Thistle BoardFinish, MultiFinish, BondingCoat, Browning, Universal OneCoat, DuraFinish, SprayFinish, ToughCoat and HardWall.

The EPDs were externally verified for the Thistle plaster products following a robust Life Cycle Assessment (LCA), which calculated the environmental impact of each product throughout its lifecycle. The LCA considers a range of factors, including the effect of raw materials, manufacturing process, installation, performance in use and recycling capabilities.

"As our EPDs are based on clearly-defined EU-wide rules and regulations, our customers can be confident in the knowledge that they are receiving reliable indicators, allowing them to make an informed decision when planning or delivering a project," said Heidi Barnard, sustainability leader at British Gypsum. "We're currently the only UK plaster manufacturer to offer EPDs, but we recognise the importance of giving our customers greater transparency, especially in our industry, where sustainable practices are becoming more rigorous on an almost daily basis."

Hungary: Saint-Gobain's revenue in Hungary rose by 6.2% to Euro35.2m in 2014 from Euro33.1m in 2013. In 2015, it expects revenue growth to be about the same. The business employs 500 people and exports more than 25% of its production. Saint-Gobain's biggest investment in Hungary is a Euro32.2m wallboard plant.

Switzerland: Sika has claimed that its controlling family no longer has the right to call an extraordinary general meeting (EGM), marking the latest twist in a Euro2.76bn takeover battle for the company by France's Saint-Gobain. The sale has been opposed by Sika's board and executives, forcing the family to call an EGM where it aims to remove executives who object to it.

Sika insists that the Burkard family, who are descendants of the company's founder, are no longer exempt from a rule that restricts shareholders' to hold no more than 5% of all registered shares. An exception was originally made because of the family's close association with the company and its assertion that it would protect it against takeovers. The company said that the voting rights of the family should be restricted to 5%.

Saint-Gobain announced plans in December 2014 to acquire the holding company Schenker-Winkler Holding AG (SWH), which is the vehicle controlled by the Burkard family. It holds 16.1% of Sika's capital and 52.4% of its voting rights. Saint-Gobain is targeting the Sika stake in an attempt to kick-start its own earnings growth.

"Now that the Burkard family / SWH have formed a group with Saint-Gobain, this historical privilege must be considered lost, together with the right to convene extraordinary general meetings," said Sika. Sika said shareholders representing more than 35% of its total capital have given their assurance that they support the board of directors in its efforts to fend off the takeover.

France/Switzerland: Saint-Gobain plans to acquire a controlling stake in Sika, a construction chemicals producer. The transaction involves Saint-Gobain's purchase of Schenker Winkler Holding AG, which owns 16.1% of Sika's capital and 52.4% of voting shares, for Euro2.3bn.

After the acquisition, Saint-Gobain will be able to fully-consolidate Sika into its operations, which will have a positive impact on net income in the year after consolidation. Saint-Gobain Group does not intend to make an offer for the remaining shares of Sika.

Sika has 16,000 employees in 84 countries. Its total sales in 2013 amounted to Euro4.3bn. It has experienced an average of 8%/yr growth in 2007-2013. Given the similarity in the activities of Sika and Saint-Gobain, it is expected that the acquisition will generate Euro100m in synergies from the second year of consolidation (2017) and Euro180m by 2019.

The deal requires the permission of the competent antitrust authorities and is expected to be completed no later than the second half of 2015.

Indonesia: Saint-Gobain has inaugurated its first wallboard plant in Indonesia, near Jakarta. With a production capacity of 30Mm², the new plant will enable Saint-Gobain to respond better to local demand and continue the group's growth on the rapidly-growing Indonesian wallboard market. Saint-Gobain has four other plants in south-east Asia, in Malaysia, Thailand and Vietnam.

Indonesia: PT Saint-Gobain Construction Products Indonesia (SGCPI), a subsidiary of Saint-Gobain Group, has invested approximately US$45m in the construction of a gypsum wallboard plant within the Cikande industrial estate in Serang, Banten. The 33Mm²/yr capacity plant, which is located on a 60,000m² plot of land, will be officially opened on 28 October 2014 after 18 months of construction.

According to Edward Loy, SGCPI's managing director for Indonesia, Malaysia and Singapore, production will start in November 2014 and the plant is expected to operate at full capacity by the end of 2015. Loy said that the plant was a first for the firm's industrial mortars division in Indonesia, hinting that there would be more investments to come from its glass and abrasives production in the near future.

"We want to position ourselves as strategic investors in Indonesia and we have more investments coming through in the next few years as well," said Loy.

With the opening of the plant, Loy suggested that the company would become more efficient in terms of pricing. "The opening of the plant will allow us to position ourselves as a local player in the market, so even though we started in 2007 with imports, it wasn't competitive. Now we'll have no more freight charges or shipping and handling," said Loy. In spite of his optimism, the regional managing director acknowledged that his firm would need to face the challenge of competing against cheaper, readily available yet unsustainable construction materials like asbestos and sand bricks.

"We can't compete with clay and sand bricks when the labour is still very cheap, but we can make sure the price difference is small and they are not offering the same kind of quality that we are," said Loy. "We'll deliver quality and performance to the homeowner." According to him, three factors will be decisive in driving the adoption of SGCPI's Gyproc brand of gypsum boards in the country; rising labour costs, knowledgeable consumers and the shift toward using green and sustainable construction materials.

Loy said that around 40-45% of the firm's business would be in the residential sector, while the rest of his clients would come from the commercial and public sectors, catering to spaces such as shopping malls, airports and hospitals.

France: Saint-Gobain and EBRD (European Bank for Reconstruction and Development) have signed an agreement whereby EBRD will increase its participation in Saint-Gobain Construction Products Rus LLC from its current stake of 11% to 33%.

The EBRD equity injection will contribute to financing Saint-Gobain Construction Products' planned investments in Russia for the next three years, including projects in the gypsum, industrial mortars and insulation activities in several regions.

The investments will reflect the Environmental and Social Action Plan that was agreed with EBRD, thereby reaffirming the commitment of Saint-Gobain Group to the highest standards in environmental performance, corporate governance and business conduct.

This operation will contribute to the acceleration of Saint-Gobain's development in Russia, in alignment with the Group's strategy of strengthening its position in fast growing markets.

Thailand: Thai Gypsum Products Plc (TGP), a subsidiary of France's Saint-Gobain, expects sales of its Gyproc construction and finishing materials will expand by 5% in 2014, citing continuous growth in home renovations and building markets.

Thongchai Kamolpattana, the commercial director for the Gyproc brand, said that demand from housing projects and home renovations had increased since 2013 and would allow TGP to earn higher revenue in 2014. Kamolpattana added that provincial markets would keep Gyproc sales afloat even if political problems persist in Bangkok.

Earlier in 2014 TGP experienced a minor negative effect from the prolonged political impasse that caused consumers to delay decisions to buy condominium units in Bangkok. "Demand for condominiums declined because customers in Bangkok took a wait-and-see stance," said Kamolpattana. "However, our market still did well in other provinces." He added that if political problems continue until year-end, TGP's performance in Bangkok might be affected. "If so, consumer confidence would be badly affected and that might reduce demand for our products. However, business confidence has rebounded since the coup."

Gyproc has expanded into modern-trade malls, particularly in Chiang Mai and Chon Buri provinces, helping the brand to boost sales by 5%. The products are available in 400 malls, resulting in greater brand awareness and accessibility to its products among contractors and homeowners nationwide.

The company plans to open more Gyproc solution centres in 2014, including in Phuket, in order to prepare for rising opportunities under the Asean Economic Community, which is due to kick off late in 2015. According to Kamolpattana, gypsum boards have gained strong market recognition in 20 Asia-Pacific markets, particularly the Philippines, Malaysia, Indonesia and Australia.

Russia: Saint-Gobain has announced that it intends to build a gypsum plant in one of the lime fields in Chelyabinsk Oblast. The plant will produce products under the Gyproc name. The investment amount has not been reported. Saint-Gobain also has a company producing Linerock basalt fibre at the Minplita plant in Chelyabinsk Oblast.