Shareholder approval paves way for merger

The merger between global building materials giants Holcim and Lafarge, which was first announced in April 2014, is now virtually assured after Holcim shareholders accepted revised merger terms.

The proposed union hit a snag in March this year when Holcim’s board of directors announced it was no longer willing to proceed with the previously agreed terms.

The two companies eventually reached an agreement on a new set of terms, which involved a revised exchange ratio of nine Holcim shares for every ten Lafarge shares as well as a reshuffling of the executive team. This resulted in the appointment of Lafarge CEO Bruno Lafont and Holcim chairman Wolfang Reitzle in equal standing as non-executive co-chairmen of the LafargeHolcim board.

The original merger terms had initially positioned Lafont as the CEO of the merged entity but Lafarge executive vice president Eric Olsen has since been selected to fill the role.

The companies are now one step closer to finalising their merger after these new terms gained the support of an “overwhelming majority” of Holcim’s shareholders at its recent extraordinary general meeting.

“It is a great satisfaction that Holcim shareholders overwhelmingly gave their support to the proposed merger,” Lafont commented. “This endorsement is a clear demonstration that shareholders are fully convinced of the substantial value creation potential. I am confident that Lafarge shareholders will in turn ratify this once in a lifetime opportunity and tender their shares, paving the way to the merger. The combined group will be a unique global champion in the building materials industry focusing on customers and innovation, uniting the best teams in the industry.”

It was reported that Holcim filed the public exchange tender offer for the Lafarge shares with the Autorité des marchés financier on 11 May after receiving a “favourable opinion” from Lafarge’s board of directors.

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