Philippine: San Miguel to build 2 cement plants as Philippine economy grows

Byszheng

Updated Thu, 23 Jul 2015 09:19:36 GMT

Philippine conglomerate San Miguel will spend $800 million to build two cement plants by 2017 amid rising demand from the development of high-rise buildings and infrastructure such as roads accompanying economic growth here.

One of the plants will be constructed at the site of an existing plant a subsidiary owns in the province of Pangasinan on the northern island of Luzon, documents filed with the Philippine Stock Exchange show. The other is to be built in the province of Quezon, also on Luzon.

Each plant will have an annual production capacity of 2 million tons and will cost around $400 million, which will be paid for by issuing new shares and borrowing from banks.

 Philippine cement demand grew 6% in 2013 to 19.4 million tons, the Cement Manufacturers' Association of the Philippines says. The government spent only 3% of gross domestic product on infrastructure in 2014, but President Benigno Aquino intends to raise that figure to 5% by 2016. That increase is sure to boost demand further.

Known primarily as Southeast Asia's oldest brewery, San Miguel has been diversifying into infrastructure-related businesses.