Cemex 2013 Annual Report Download - page 16

back-office services, as well as IT infrastructure, applica-
tion development, and maintenance services. When all of
these services are fully transferred to IBM, we anticipate
achieving steady-state savings of more than US$100
million per year. Moreover, this agreement will improve
the quality of services provided to our company, enhance
our business’ agility and scalability, maximize our internal
efficiency, and serve our customers with greater speed,
precision, and quality. In light of this positive relationship,
we will continue to explore ways to partner with world-
class companies like IBM to generate greater value for
our company and our stakeholders.
In addition to improving our operating performance, we
are focusing our efforts on optimizing our asset portfolio
to generate a higher return on capital employed. Among
our initiatives, we will continue to pursue strategic asset
swaps, through which we can capture synergies and
create more value for our investors without the necessi-
ty of making significant capital investments. We will also
only divest operating assets if they are accretive to our
company and our investors. We will further continue to
selectively divest non-operating assets, including equip-
ment and real estate. Indeed, over the past four years, we
have sold approximately US$700 million of non-operat-
ing assets—including approximately US$170 million this
year—which has significantly enhanced our balance sheet.
Consistent with these initiatives, in August, we announced
a series of three innovative transactions that will further
improve our return on capital employed. These transac-
tions include:
First, CEMEX’s acquisition of Holcim’s operations in the
Czech Republic; the Czech Republic is a market with a
strong economy and solid prospects, and we expect the
acquisition of these assets will considerably reinforce our
position in the country and in Central Europe.
Second, CEMEX’s divestiture of its assets in the western
part of Germany to Holcim; Germany is an attractive
market, and we will continue to maintain an important
presence in the eastern, northern, and southern part of
the country, including the capital city of Berlin.
Third, the combination of the cement, ready-mix con-
crete, and aggregates operations of CEMEX and Holcim in
Spain; CEMEX will have a 75% controlling interest of the
combined assets—which will enable us to consolidate this
operation and should translate into higher value creation
in this market.
Through these milestone transactions, which are subject
to regulatory approval and other conditions, we will opti-
mize our regional network of assets, increase our produc-
tivity, and extract synergies that will result in a recurring
improvement in our operating EBITDA of about US$20
million to US$30 million per year. In connection with
these transactions, we will also receive a cash payment of
approximately €70 million.
~US$700 of non-operating
assets sold over the
past four years
million
[15]