EU Approves Lafarge-Holcim Merger To Form Cement Titan

EU Approves Lafarge-Holcim Merger To Form Cement Titan

EU anti-trust regulators on Monday cleared the merger of French giant Lafarge with Swiss rival Holcim to form the world's biggest cement group after each sold elements of their enterprise to meet competition concerns.

"Acquisition of Lafarge by Holcim is topic to conditions. The merger can proceed," EU Competition Commissioner Margrethe Vestager said on Twitter, adding the move was "good for development".

The European Commission said it allowed the merger to go ahead given that Lafarge divest companies in Germany, Romania and Britain and that Holcim do the identical in France, Hungary, Slovakia, Spain and the Czech Republic.

Holcim and Lafarge announced in April they have been merging to create the world's biggest cement group price forty billion euros ($55 billion), with an eye on booming development in rising markets.

The deal, a serious occasion within the international construction industry, is predicated on the offer of 1 Holcim share for one Lafarge share.

The new firm can be called LafargeHolcim and "can have a novel position in 90 countries and will likely be evenly balanced between developing countries and international locations with robust development," the companies said in a joint statement.

They highlighted the match of their activities since Lafarge has a robust presence in Africa and Holcim in Latin America.

Nonetheless they both have big and competing interests in Europe.

The European Commission said it had had concerns that the "transaction, as originally notified, would have" hurt competition in lots of markets in Europe but that the 2 corporations later "dedicated to divesting many of the operations the place their actions overlap".

"With the remedies, we have now ensured that the creation of an increased world footprint of the group is not going to come on the expense of competition within the EU," Vestager said in a statement.

"And this is the optimistic instance immediately's approval provides to other companies that will have world ambitions," she said.

The Commission added that the 2 corporations will not be allowed to complete their deal till it has approved the businesses who will buy the belongings put up for sale.

- 'Great satisfaction' -

Figures showed that the new giant will employ 136,000 folks, and have annual sales of 32 billion euros and undermendacity profits of 6.5 billion euros.

The deal would generate economies of scale of 1.four billion euros over three years.

LafargeHolcim will likely be in a strong place as a provider of cement, a key primary material in construction.

Building provide companies have been increasing in emerging countries the place they see enormous opportunities for growth as they face sluggish conditions within the European development industry.

Shares in the new agency will likely be listed on stock exchanges in Paris and Zurich.

"We welcome with nice satisfaction the commission's positive decision," said Wolfgang Reitzle, the longer term chairman of LafargeHolcim, and Bruno Lafont, the future chief executive officer, in a joint statement.

"Because of this approval, we stay more than ever on the precise path to finalise the merger in the first half of 2015."

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