Cement makers Lafarge, Holcim agree on merger plan: Media

This combination of files pictures made on April 4, 2014, shows a file picture of the logo of the French building materials group Lafarge taken on July 17, 2009, in Paris, and a file picture of the logo of the cement company Holcim taken on Aug 23, 2
This combination of files pictures made on April 4, 2014, shows a file picture of the logo of the French building materials group Lafarge taken on July 17, 2009, in Paris, and a file picture of the logo of the cement company Holcim taken on Aug 23, 2007, in Eclepens, western Switzerland. -- PHOTO: AFP

PARIS (REUTERS) - The world's two largest cement makers, France's Lafarge and Switzerland's Holcim , on Saturday agreed on the terms of a merger that would create a company with a stock market value of around US$55 billion (S$69 billion), French newspaper Le Figaro reported on its website.

Representatives at Lafarge and Holcim were not immediately available to comment on the story, which did not say how it got the information.

The two companies had already issued dual statements on Friday announcing they were in advanced talks to merge, a deal which would help them slash costs, trim debt and better cope with the soaring energy prices and weaker demand that have hurt the sector since the 2008 economic crisis.

The transaction will see Holcim launch a public takeover offer for Lafarge, payable entirely in shares, Le Figaro said.

If successful, the combined entity will be based in Switzerland but will have operational headquarters in both Switzerland and France. Lafarge chief executive officer (CEO) Bruno Lafont will become CEO of the combined entity while the chairman will be Swiss, according to the report.

But any deal is likely to draw scrutiny from European competition watchdogs, as a Lafarge-Holcim entity would have a dominant position in both Europe and the United States.

Regulators would probably require the companies to shed cement plants and distribution facilities before approving any merger.

Register here to get free digital access to The Straits Times until Aug 9, 2015.
Comments