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AECI to sell noncore assets, focus on core mining, chemicals capability

13th November 2023

By: Marleny Arnoldi

Deputy Editor Online

     

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Diversified chemicals solutions company AECI will increase focus on its core mining and chemicals capability and divest noncore businesses.

The group aims to double the profitability of its core mining and chemicals business by 2026 and become a global top three integrated mining explosives and chemicals solutions provider by 2030.

AECI plans to divest from its identified noncore businesses – Much Asphalt, Animal Health, Schrim, Sans Fibers and Beverage – over a period of time.

AECI CE Holger Riemensperger told stakeholders at the company’s Capital Market Day on November 6 that some synergies exist across its diversified industrial group, while other business units within the portfolio have no synergies.

Those underperforming units would be better served under different ownership, he said.

The planned changes are aimed at ensuring that AECI reaches its centennial anniversary in 2024 and better positioning it to navigate the changing environment, as well as ensuring growth in future.

The strategic update follows a comprehensive review of the business’ operations in which the board and management identified the business units that are central to the sustainable and profitable growth of AECI.

Notably, acquisitions are not central to this strategy in the next 18 months as the group focuses on optimising its base, including AECI Mining as the main focus.

The company will reorganise and reposition the Chemicals division to enhance its cash generation capabilities through prioritising high margin products and services, which will also support growth in the Mining division.

AECI will look towards growth in the Asia-Pacific, South American and North American regions as it drives its ambition to be among the top three global suppliers of its kind by 2030.

The group has also adjusted its management structure to reflect the changes in the business and to drive empowerment, accountability and quick decision-making.

AECI employs more than 7 000 people across 100 sites, with a presence in 22 countries on six continents.

The company’s products and services include mine-to-mineral solutions, water treatment solutions and chemical raw materials and related services.

“We recognise that to secure our place for the next 100 years, we must embrace change, progress our strategy to seize new opportunities and navigate market shifts with agility and profitability.

“I believe the changes we are making will be net positive for the business and the unwavering focus on operational and functional excellence will act as a catalyst for further innovation and profitable growth, and will unlock value for all of AECI’s stakeholders,” Riemensperger concludes.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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