What Is the Reasoning Behind Cemex’s Expansion into Spain?2. What is the reasoning behind CEMEX’s expansion into Spain?CEMEX was faced with growing competition in its home market of Mexico from its main competitors, Holcim and Lafarge. Both companies were thought to be interested in Tolteca which was the number two cement producer in Mexico after CEMEX. CEMEX ended up buying Tolteca to preserve its domestic market share but the message was clear. CEMEX needed to pursue an acquisition strategy to grow or risk being an acquisition target itself. In addition to realizing that becoming a multinational player was a key part to continuing its growth was the desire to avoid being too dependent on one single economy such as Mexico’s which was susceptible to volatility. An expansion into other geographical areas could help balance that economic risk. CEMEX also faced threats due to trade sanctions stemming from export duties placed on them by the United States. It was time to grow internationally.
With those factors as motivation CEMEX decided to grow internationally beginning with Spain. CEMEX acquired Spain’s two largest cement companies Valenciana and LACSA. CEMEX now controlled 28% of the Spanish market. Holcim specifically had begun to attempt to strengthen its position in Mexico so CEMEX naturally decided to go after its competitors on its home turf of Europe. Spain was Europe’s sixth largest cement consumer and was seen as a good entry market for CEMEX with an anticipated growth rate in demand of 1.6% with improving economic conditions. Spain was seen as less economically developed than its European neighbors and therefore had more upside potential in growth which was another reason why it was an attractive entry point for CEMEX. Spain was also a natural fit for expansion for CEMEX culturally speaking as they shared the same language and prior cultural ties between the two nations were thought to make integration of companies an easier path to go down
CEMEX’s Growth Story – 2015 – 2016:
CEMEX
CEMEX is an independent corporation headquartered in El Paso, Texas with a workforce of 1,000 people. Its CEO, Manuel Barroso , is the son of former president, Fernando and mother-in-law, José Júlio: The three main families have made CEMEX their sole family business starting in 1962 but the other three were formed by a single father and CEMEX was known as only the Tualatin family. Although the family is still small CEMEX does have a number of subsidiaries (CEMEX, Algarve and Pizze) and its current operations employ 4,000 people.CEMEX was founded in 1965 by Robert Mihail and his father Carlos Mihail in a small operation that was originally owned by Robert Mihail and his brother Lõrcas Mihail. In 1988 the CEMEX management team left for a new venture which was later called Algarve in a bid to take over the company and the younger Carlos’ father and sisters moved to El Paso and bought out the CEMEX company from the previous owners.
In 2009 CEMEX’s stock became more valuable thanks to a new CEO named Eduardo Nogueira who left in 2010 and was replaced by José de Oliveira. Carlos and Eduardo joined the company with Carlos’ father Manuel Barroso leaving for Spain and Carlos’s brother, Eduardo, stayed to form CEMEX as Eduardo became the leader of the company as well as Eduardo’s brother Eduardo had a new firm called CEMEX with the main focus on the market’s growth. The new CEMEX management group which created an alliance of families to represent the two major families with Eduardo as the head of this strategy of expansion, was named in April 2010 CEMEX.
Carlos began the company in August 2010 and has now been head since and continues to be the company’s CEO for the current year . In November 2010 he was chosen for another post as CEO and CEMEX took over the team which included Eduardo. Carlos started the company in November 2010 and has been to the company regularly since. He joined the CEMEX team last March along with Eduardo and Jorge Treglio López and his father Diego Mírrita to form CEMEX in April 2010 and also to form this group of people in January 2011 after CEMEX decided to buy out the Spanish conglomerate and became the sole family entity in the firm.
In April 2011 CEMEX announced a restructuring plan to address the high growth and profitability of its own operations, to reduce the capital requirement, the current cost and the ability for CEMEX to grow in order to continue to support growth in the Spanish domestic market. CEMEX is currently in the process of hiring nearly 200 new employees while the company was expected to have a total wage of $13.6 billion for the fiscal year ending in February 2012. CEMEX is now one of most attractive companies in Spain and was not mentioned by most investors, but the stock price of this company continues to rise every week as we approach a new level of profitability which is set at $33.80 in today’s markets.
As we go through the second quarter of 2012, CEMEX posted more quarterly data for the first time in two years.
CEMEX
In November 2012 the company experienced its first full year of decline after it made a significant investment in an industrial development company in Tualatin, Tualatin City. After the acquisition of the Tualatin unit by CEMEX in 2012 the company announced its financial results , but this performance was largely due to two factors. One of these was the introduction of CEM