Analysis by Industrious Labs details serious potential liabilities across Holcim’s North American assets as the cement maker prepares $30 billion spinoff with an IPO

NEW YORK — Major pollution liabilities across Holcim’s U.S. and Canadian facilities hang over the company’s potential $30 billion spinoff with an IPO, according to a new investor brief from Industrious Labs. The new analysis details a troubling track record of repeated air and water quality violations and active lawsuits and administrative penalties that raise concerns around whether Holcim’s North American facilities are poised to succeed in the growing market for clean cement — or face potentially massive costs to catch up.

“Not only is Holcim far from the industry leader it claims to be when it comes to sustainability, but it is sitting on a mounting pollution problem that will translate to higher costs and reduced market share for investors. At every turn, Holcim’s North American facilities present a litany of risks when it comes to open lawsuits, repeated air and water violations, and a habit of cutting corners that open any one of these facilities up to major liabilities,” said Ash Lauth, Senior Campaign Strategist for Industrious Labs. “Without a clear plan to demonstrate how Holcim intends to modernize these facilities for a rapidly shifting cement market, this research begs the question: is Holcim’s upcoming spinoff a potential win for investors, or just another way for Holcim to wipe its hands of its most polluting assets?”

The new report, Holcim’s Cracked Foundation: An Investors Brief, highlights a range of recent and outstanding pollution violations and vulnerabilities surrounding its U.S. and Canadian facilities, including:

• MICHIGAN: Persistent violations of the Clean Water Act at its Alpena, MI quarry, including leaching mercury into groundwater.

• MARYLAND: Repeated violations of mercury emissions limits at its Hagerstown, MD plant in 2022 and 2023, which began just three years after a $96 million mandated plant upgrade meant to resolve federal Clean Air Act violations.

• PENNSYLVANIA: Consistent violations of nitrogen oxide, sulfur dioxide, mercury, particulate matter, and total hydrocarbons limits  — as well as periodic Clean Water Act violations — since taking over its Whitehall, PA plant in 2018; Holcim agreed to state penalties in 2022 and 2024.

• ALABAMA: Significant increases in nitrogen oxide emissions after a 2021 modification to its Theodore, AL plant without required permits, as well as four state fines against the plant between 2019 and 2022 for unlawful fugitive dust emissions, failure to conduct monitoring and maintain records, and federal dioxins/furans limit violations.

• TEXAS: The highest sulfur dioxide, fine soot, and volatile organic compound emissions — and second highest lead emissions — of all cement plants in the state in 2021 at its Midlothian, TX plant; a lawsuit was filed from a local resident against the plant for excessive quarry blasting that “compromise[d] the infrastructure of nearby homes.”

• SOUTH CAROLINA: Listing of the Holly Hill, SC plant by the EPA as a “significant non complier” in 2024 around federal hazardous waste regulations; a poor safety record at this plant culminated in a 2022 wrongful death and negligence lawsuit related to the death of a worker at a plant elevator.

• LOUISIANA: Documented histories of noncompliance, nonreporting of water discharge, water quality violations, and incidents of airborne dust traveling into surrounding air and waterways at its Louisiana plants; allegations of dust making nearby workers sick; a lawsuit claiming wrongful termination against a whistleblower who reported untreated wastewater was being discharged into surrounding waters violating environmental regulations.

• CANADA: A class-action lawsuit filed against the company’s Exshaw, Canada plant in late 2023 alleging significant environmental hazards and noise pollution affecting nearby communities.

“The facts in this report may cause investors to pause,” said Nachy Kanfer, a partner at Industrious Labs. “What is the level of capex that will be required to bring these assets into basic compliance – let alone to produce a premium low-carbon product in the growing North American market for clean cement?”  

“While these violations are a canary in a coal mine, Holcim has an opportunity right now to prove to investors it’s ready to be a market leader on clean cement. In order to do so, the company must make a clear commitment to operate no wet kilns, drastically reduce its on- and off-site emissions, and identify at least one flagship plant to be net-zero by 2030,” concluded Lauth. 

The report comes on the heels of a scorecard which gives Holcim a ‘D’ grade for its significant weaknesses on climate and failure to scale up clean cement technology. With the market for clean cement rapidly expanding, investors and analysts have shown growing concern that Holcim is at risk of falling behind its competitors, raising significant questions on whether its North American assets can deliver the full value of a potential $30 billion spinoff with an IPO asking price.

In recent years, Holcim has walked back its “climate neutral” cement claims, following EU legislation cracking down on deceptive climate claims. The Swiss company has also caught flak from investors for its lack of goals to reduce its absolute emissions, and has evidently stepped back as an industry leader on climate change by divesting (often at below-replacement prices) from markets where low-carbon cement is most needed.