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Heidelberg Materials strengthen presence in Indonesia

Acquisition of integrated cement plant in Central Java from local cement producer PT Semen Grobogan

HEIDELBERG Materials, via their subsidiary Indocement, have signed an agreement to acquire 100% of the shares in PT Semen Grobogan’s integrated cement plant located in Central Java, Indonesia, which started commercial production in 2022.

With this investment, Heidelberg Materials will further strengthen their footprint in Indonesia, one of the company’s core markets in Asia-Pacific. The Semen Grobogan cement plant has a capacity of 1.8 million tonnes of clinker and 2.5 million tonnes of cement, together with sufficient limestone reserves to last for more than 50 years. Both parties have agreed not to disclose the purchase price.

Dr Dominik von Achten, chairman of the managing board of Heidelberg Materials, said: ‘As part of our ongoing portfolio optimization, we are making an exciting step in the growth market Indonesia, where Heidelberg Materials has been active for more than 20 years.

‘With this investment, we are now strengthening our presence in one of the most populated regions in Indonesia, where we expect further market growth driven by the growing retail market, developing industrial areas, and major infrastructure projects. As frontrunners of decarbonization in the emerging markets, we continue to drive our ambitious carbon-reduction targets at all our sites in Indonesia, including the new cement plant.’

Indonesia is the world’s fourth most populated country. With about 41 million people, Central Java is the third most populated area in Indonesia and has a strong retail cement market. Important infrastructure projects classified as national strategic projects are planned in this area, such as the Solo-Yogyakarta, Yogja-Bawen and Semarang-Demak toll road, as well as the Batang industrial area, and the Kendal Special Economic Zone.

The investment in Semen Grobogan will allow Heidelberg Materials to leverage significant synergies with their existing businesses in Indonesia regarding logistics, usage of alternative fuels, as well as transfer of technical and sustainability know-how.

As part of the company’s global climate strategy, the new plant will develop a tailored CO2 roadmap with concrete measures to accelerate the reduction of carbon emissions. Furthermore, the plant’s limestone reserves complement the existing reserves of Indocement in Central Java.

Through their Indocement subsidiary, Heidelberg Materials already operate four cement plant complexes with 14 lines in Indonesia, including the Citeureup plant in West Java, which is one of the world’s largest cement plants, and the recent Maros plant under leased arrangement in South Sulawesi.