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 large Lafarge with Swiss rival Holcim to form the world's biggest cement group after each sold components of their enterprise to meet competitors 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 growth".

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

Holcim and Lafarge introduced in April they were merging to create the world's biggest cement group worth 40 billion euros ($fifty five billion), with an eye on booming development in rising markets.

The deal, a major event within the international development trade, is predicated on the provide of 1 Holcim share for one Lafarge share.

The new company will probably be called LafargeHolcim and "can have a unique position in 90 countries and will be evenly balanced between growing countries and international locations with sturdy growth," the firms said in a joint statement.

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

However they both have big and competing pursuits in Europe.

The European Commission said it had had concerns that the "transaction, as originally notified, would have" harm competitors in many markets in Europe however that the 2 firms later "dedicated to divesting many of the operations where their actions overlap".

"With the treatments, we now have ensured that the creation of an increased international footprint of the group is not going to come at the expense of competitors in the EU," Vestager said in a statement.

"And this is the positive example at this time's approval provides to other firms that may have world ambitions," she said.

The Commission added that the two firms is not going to be allowed to complete their deal until it has approved the companies who will purchase the assets put up for sale.

- 'Nice satisfaction' -

Figures showed that the new giant will make use of 136,000 individuals, and have annual sales of 32 billion euros and underlying profits of 6.5 billion euros.

The deal would generate economies of scale of 1.4 billion euros over three years.

LafargeHolcim shall be in a powerful place as a provider of cement, a key fundamental materials in construction.

Building provide companies have been expanding in rising international locations the place they see huge alternatives for progress as they face sluggish circumstances in the European construction industry.

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

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

"Due to this approval, we remain more than ever on the best path to finalise the merger in the first half of 2015."

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