Ciments du Maroc borrows $274 mln for new plant

RABAT, July 12 (Reuters) - Moroccan cement producer Ciments du Maroc (SCM.CS) signed a 2 billion dirham ($274 million) loan agreement with five banks to help finance a new factory due to start production in March 2009, the company said.

The new 3.5 billion dirham plant near Agadir in southern Morocco, with annual capacity of 2.2 million tonnes of cement and 1.6 million tonnes of clinker, will help the company compete with local rivals Lafarge Ciments (LAC.CS) and Holcim (HOL.CS).

All three are investing heavily to meet surging demand for cement in Morocco due to ambitious transport infrastructure and housing projects and a multitude in tourism developments.

The loan agreement was signed on July 9 with Attijariwafabank, BMCE Bank, BMCI, Credit du Maroc and Societe Generale, Ciments du Maroc said in a statement dated July 11.

"The start-up of the crushing unit and output of cement is foreseen in March 2009, while production of clinker should begin in Sept. 2009," it said, confirming a timeline given in April.

Morocco's cement market has grown at 8 percent a year since the start of the decade and Ciments du Maroc, a unit of Italcementi (ITAI.MI), has struggled to keep output growing as fast as demand.

The company has been forced to buy in clinker from competitors to assure supply, denting profitability. Margins have shrunk further as the cost of energy grew.

Ciments du Maroc's net profit grew 17 percent last year to 612.5 million dirhams but operating profit climbed just 4.3 percent to 900 million.

Company executives have forecast double-digit percentage growth in the Moroccan cement market again this year after a 12.6 percent increase in 2007. (Reporting by Tom Pfeiffer, editing by Mike Peacock)