Thai cement firm mulls investment in Phl

BANGKOK, Thailand – Manufacturing giant SCG yesterday announced they are looking at buying an existing cement manufacturing firm in the Philippines as they increase their existing $100 million investment in the Philippines.

“We are looking at the Philippines. For our investment in cement, we have two options. First is Greenfield and the second is acquisition,” SCG president and chief executive Kan Trakulhoon told The STAR in an interview.

According to Trakulhoon, they prefer acquisition and they are already looking at some cement manufacturing firms in the Philippines. He refused, however, to name which cement firm they are looking at. He said the current strategy of SCG is mergers and acquisition.

“Philippines is our target for investment,” he said.

In the next five years, SCG is allocating $5 billion for investments in the ASEAN region. He did not say how much is for the Philippines saying only that it depends on many factors.

Trakulhoon said that if they opt to build their own plant they will spend around 10 billion baht or around P13.9 billion. He said a medium sized plant will cost them around 10 billion baht. He explained that in 2007, they built a small manufacturing firm in Cambodia and it cost them 5 billion baht.

Trakulhoon did not answer questions with regards to the timeline of the investment. Should SCG build their own manufacturing plant in the Philippines, then they will have to deal with getting licenses and applying for a quarrying license.

Trakulhoon denied that the recent flooding in Thailand is not the reason why they are considering the Philippines. He said this has been the plan since last year. In fact, he said he spoke with President Aquino when the President visited here.

Trakulhoon said during the meeting with the President, he mentioned that one of the biggest obstacles in investing in the Philippines is the power cost. He said that a major concern for them is the very high power cost in the Philippines.

“The energy cost is quite high,” Trakulhoon said.

In spite of the high power cost in the Philippines, Trakulhoon said they are already very active in the Philippines. SCG has partnered with the Coseteng family for the Mariwasa Tiles. He said there will be small expansions in the Mariwasa firm this year. Currently, Mariwasa Tiles is only for domestic consumption. He said they are studying if they can export Philippine made tiles to other countries.

Meanwhile, SCG has joined a consortium of companies to showcase the potential of the Thai industry with a host of technologies and innovations that can compete internationally at the on-going BOI Fair 2011.

“As a leading corporation in Thailand, SCG takes part in BOI under the theme ‘Going Green for the Future’ which is in tune with Thailand’s development direction, encompassing economic, social and environmental development,” Trakulhoon said.

The SCG Pavilion is built around the Human Value concept of SCG which is committed to creating innovations that not only meet consumer demands but also show concern for human value. The objective is to provide alternatives for customers who are concerned about changing world environment and want to play a part in protecting the earth.