McInnis Cement secures financing for plant serving New England, Mid-Atlantic, Great Lakes, Eastern Canadian markets
- Written by Concrete News
Quebec Premier Pauline Marois joined business leaders January 31 to outline a financial structure enabling McInnis Cement, an export-driven start up headed by industry veterans, to commence Spring 2014 construction of a plant and marine terminal with ultimate capacity toward 2.5 million tonnes/year.
The announcement was made in Port-Daniel-Gascons, located on a Gulf of St. Lawrence inlet on the province’s eastern reaches. It caps the completion of permitting, environmental review and financing window for a $1 billion greenfield operation. Project leader is Beaudier Inc., the investment arm of the Beaudoin family, a majority shareholder in two of the province’s preeminent corporate brands: Bombardier (business and commercial aircraft, and trains) and Bombardier Recreational Products (Ski-Doo, Sea-Doo and Can-Am).
“For more than two years, Beaudier has invested its time, energy and resources to ensure the McInnis Cement project goes ahead,” says Beaudier Chairman Laurent Beaudoin. “A partnership with experienced private investors, a Quebec public pension fund and the Quebec government will allow it to go forward.”
Leading the equity side, Beaudier is teamed with the pension fund, La Caisse de depot et placement du Quebec, through an equity stake of $100 million, which is matched by the investment arm of the Quebec government. “The McInnis Cement project is fully aligned with the international export activity that remains the driving force of Quebec economic growth,” notes the pension fund’s Michael Sabia, chief executive officer. “I am convinced that with the excellent management team recruited by Beaudier and U.S. market proximity, this project is a sound investment.” The financing is completed through a guaranteed loan structure of senior debt from a banking syndicate led by National Bank of Canada, plus junior debt in the form of a $250 million Quebec government loan at a 3 percent premium rate over the senior debt.
The Port-Daniel-Gascons site enables a load out operation to dispatch deep water cement vessels through the St. Lawrence Seaway or down the Atlantic Coast with two to four days’ “ship time” to eastern Great Lakes, New England and Mid-Atlantic terminals. “The location will make us highly competitive in the East Coast and Canadian markets,” affirms McInnis Cement CEO Christian Gagnon, whose track record has spanned Lafarge Group mill expansions and greenfield projects from British Columbia to Greece.
“Many concrete producers and contractors in Northeast and Great Lakes markets are sourcing cement from dated mills,” adds Senior Vice President, Commercial and Logistics Jim Braselton, who joined McInnis following a long Lafarge North America tenure in cement and cementitious materials sales and marketing. “Nearly 25 million tons of the capacity in our market radius is from plants 50 years or older. When weighing the aged mill factor, along with projected growth in U.S. cement consumption, and uncertainty with overseas imports, buyers will need to reevaluate supply chains over the next three to five years.”
McInnis Cement officials plan a two-year construction phase, initial deliveries projected by spring of 2016. Along with preliminary site work this spring, they intend to announce major construction and equipment contracts by mid-year.