Cemex: Mexico's Global Giant
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Case Details:
Case Code : BSTA065
Case Length : 16 Pages
Period : 1990 - 2003
Organization : Cemex
Pub Date : 2003
Teaching Note :Not Available
Countries : Mexico
Industry : Cement
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Please note:
This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
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Excerpts
The Cement Industry
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Cement was a fine mineral powder. A blend of limestone when burnt with smaller quantities of aluminum, silicon and iron yielded marble sized pellets called clinker. Clinker was then ground with gypsum and other minerals to yield cement. Cement was the most preferred construction material in the world...
Background Note
Cemex began as Cementos Hidalgo in 1906 near Monterrey, Northern Mexico with a capacity of 5,000 tons per annum. When it merged with Cementos Portland Monterrey founded by Lorenzo Zambrano in 1931, it became Cementos Mexicanos. Later the company's name changed to Cemex...
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Globalization
In 1985, when Lorenzo Zambrano (grandson as well as namesake of the company's founder) took over as CEO, Cemex started looking seriously at global expansion. The Stanford alumnus realized that, in an increasingly open world, where competition could come from any quarter, it was necessary to learn and improve faster than existing and potential competitors...
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Managing Acquisitions
Cemex believed its ideal acquisition target had to be based in a country having a large, growing population, with a relatively low per capita consumption of cement.
Cemex aimed at controlling at least 25% of the markets it entered. Before going ahead with the acquisition, Cemex examined the potential for restructuring both the target company and the market structure in the region.
Restructuring the target company meant increasing its efficiency and optimizing capacity utilization... |
Excerpts Contd...>>
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