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Cemex axe set to save £200m

NEWS

EXECUTIVES at Mexican cement giant Cemex expect the current shake-up across the group to save £200 million by the end of 2007.

Last week the firm announced that 750 jobs would go at RMC, which it bought for £2.3 billion in March.

The redundancies at the building materials firm will be completed by October.

They will form the bulk of the £140 million Cemex said it can save on its European operations.

The firm said it would be closing up to 20 ready mix plants in the UK and 10 aggregates complexes.

At an analysts' presentation last week Cemex bosses said RMC's fuel costs were 25 per cent higher than its own with power costs 10 per cent higher.

Juan Pablo San Agustin, senior vice president of strategic planning, said the firm was getting to grips with the problems at RMC's cement plant at Rugby which last year was hit by 229 stops leading to a productivity level of just 71 per cent.

He said: 'We know that solving Rugby was a priority. Since April we have had almost no stops and maintained the utilisation rate over 90 per cent.'

The New York Stock Exchange listed group revealed that 2,000 employees, including those at RMC, will be axed across the group in the next two and a half years.

The firm said a reorganisation of its US business would save it £50 million.