The merger of Holcim and Lafarge has moved a step closer with the announcement of a project to sell assets to CRH for €6.5 billion (£4.9bn).
The assets include operations mainly in Europe, Canada, Brazil and the Philippines (see full list below).
“The projected transaction is a key step towards the creation of LafargeHolcim and the value offered reflects the strong quality of the selected assets. This successful outcome demonstrates the quality of the collaborative work undertaken by Holcim and Lafarge teams. With this announcement, we remain firmly on track to complete our proposed merger in the first half of 2015,” commented Wolfgang Reitzle, designated chairman of the board of directors of LafargeHolcim and Bruno Lafont, designated CEO of the future combined company.
Albert Manifold, CRH chief executive, said: “This transaction represents a significant value creation opportunity for CRH. We are acquiring a quality portfolio of assets, which complement our existing positions, at an attractive valuation and at the right point of the cycle. The acquisition strengthens our presence in important markets across North America, Western, Central and Eastern Europe as well as providing new platforms for growth in emerging markets. The assets willintegrate well into existing CRH networks benefiting from our strong business-building capabilities while providing an important platform for future development opportunities. We have maintained our disciplined investment approach through our continued focus on capital efficiency and remain focused on bringing returnsback to peak during this cycle.”
The closing of the planned merger is expected in the first half of 2015.
The two companies are disposing of the following assets in Europe:
- France: in metropolitan France, all of Holcim’s assets, except for its Altkirch cement plant and aggregates and ready-mix sites in the Haut-Rhin region, and a grinding station of Lafarge in Saint-Nazaire; Lafarge’s assets on Reunion island,except for its shareholding in Ciments de Bourbon
- Germany: Lafarge’s assets
- Hungary: Holcim’s operating assets
- Romania: Lafarge’s assets
- Serbia: Holcim’s assets
- Slovakia: Holcim’s assets
- United Kingdom: Lafarge Tarmac assets with the exception of Cauldon plant and certain associated assets
Outside Europe the two companies are disposing of the following assets:
- Canada: Holcim’s assets
- United States: Holcim’s Trident cement plant (Montana) and some terminals in the Great Lakes area
- The Philippines: the shares of Lafarge Republic, Inc. (LRI) from, and other specific assets of, the major shareholders (namely Lafarge Holdings Philippines, Inc., South Western Cement Ventures, Calumboyan Holdings, Inc., and Round Royal, Inc.), except LRI’s (i) investment in Lafarge Iligan, Inc., Lafarge Mindanao, Inc. and Lafarge Republic Aggregates, Inc., (ii) StarTerminal at the Harbour Center, Manila, and (iii) other related assets.
- Brazil: assets from both Holcim and Lafarge, which include three integrated cement plants and two grinding stations (with a total of 3.6 Mt annual cement capacity), as well as some ready-mix plants located in the Southeastern region of Brazil