Jan. 23 (Bloomberg) -- Cemex SA, the world's third-largest cement maker, extended its $11.7 billion hostile takeover bid for Australia's Rinker Group Ltd. by two months while it waits for U.S. regulatory approval.

Cemex's $13-a-share offer for Australia's biggest building materials company will now end March 30, the Monterrey, Mexico- based company said in a statement to the Australian Stock Exchange today.

Cemex wants to buy Rinker because of its business in the U.S., which is focused on Florida, Arizona and Nevada, the fastest-growing states. The deal would make it the world's biggest cement maker. Cemex Chairman Lorenzo Zambrano said today the offer is ``compelling'' while Rinker has described it as 36 percent too low.

Shares of Rinker fell 8 cents to A$18.22 at the market close in Sydney, which equates to $14.36 using today's exchange rate. The stock has gained 31 percent since Cemex made its bid on Oct. 27.

Rinker Chairman John Morschel on Nov. 29 said the Mexican company could ``offer a lot more,'' citing a report by adviser Grant Samuel & Associates Pty. which valued the stock at up to $17.74.

Cemex is offering to pay Rinker's shareholders in U.S. dollars, saying they can choose to be paid in Australian dollars at the exchange rate prevailing at the time of settlement.

U.S. antitrust regulators on Nov. 30 said they needed more information from both companies before being able to make a ruling on the proposed deal.

Earnings Report

This also gives Rinker more time to find alternatives to the Cemex offer. The Sydney-based company will report third-quarter earnings on Jan. 30, when it may face questions from investors on its defense strategy.

``The longer the process drags out, the more it plays into Rinker's hands in that the worst of the downturn in the Florida housing market may be in the past,'' Goldman Sachs JBWere Pty. said in a trading note today.

The Department of Justice's request for information was an indication Cemex may have to sell some assets in Arizona and Florida, where both companies have strong market positions, according to Andrew Dale, an analyst at Macquarie Bank Ltd. in Sydney.

The regulators intervened in Cemex's takeover of Britain's RMC Group Plc for 2.3 billion pounds ($4.5 billion) in 2005, allowing the purchase only on condition it sold RMC's ready-mix concrete operations in Tucson, Arizona, within six months to preserve competition.

Cemex's bid for Rinker would be the biggest takeover of an Australian company after a record year of acquisitions. Proposed takeovers in the country jumped to $200 billion last year, from $111 billion in 2005, according to data compiled by Bloomberg.

Cemex is advised by Citigroup Inc. UBS AG is assisting Rinker on its defense.

To contact the reporter on this story: Miriam Steffens in Sydney at msteffens1@bloomberg.net

Last Updated: January 23, 2007 01:33 EST