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[SOUTHDOWN LOGO APPEARS HERE]
October 5, 2000
Dear Shareholder:
I am pleased to inform you that Southdown, Inc. ("Southdown") has entered
into a merger agreement with Cemex, S.A. de C.V. ("Cemex"), pursuant to which
an indirect subsidiary of Cemex has today commenced a tender offer to purchase
all of the outstanding shares of Southdown Common Stock for $73.00 per share in
cash. The tender offer is conditioned upon, among other things, the tender of
at least two-thirds of the outstanding shares of Southdown Common Stock on a
fully diluted basis, regulatory approvals, and certain consents. The tender
offer will be followed by a merger in which each share of Southdown Common
Stock not purchased in the tender offer will be converted into the right to
receive in cash the price paid in the tender offer.
Southdown's Board of Directors has unanimously determined that the Merger
Agreement, the tender offer and the merger are fair to and in the best
interests of Southdown's shareholders, and unanimously recommends that
Southdown's shareholders accept the Cemex offer and tender their shares of
Southdown Common Stock in that offer.
In arriving at its recommendation, the Board of Directors considered a
number of factors, as described in the attached Schedule 14D-9, including the
opinion of the Company's financial advisor, Lehman Brothers Inc., that, as of
the date of the opinion, the consideration to be received by the holders of
Southdown Common Stock in the offer and the merger is fair from a financial
point of view to such holders. A copy of the written opinion of Lehman Brothers
Inc., which sets forth the assumptions made, procedures followed and matters
considered by Lehman Brothers Inc. in rendering its opinion, can be found in
Annex I to the Schedule 14D-9. You should read the opinion carefully and in its
entirety.
Enclosed are the Cemex Offer to Purchase, dated October 5, 2000, the Letter
of Transmittal and related documents. These documents set forth the terms and
conditions of the tender offer. The Schedule 14D-9 describes in more detail the
reasons for your Board's conclusion and contains other information relating to
the tender offer. Your Board urges you to consider this information carefully
and recommends that you tender your shares.
/s/ Clarence C. Comer
Clarence C. Comer
President and Chief Executive
Officer
