Displaying items by tag: Europe

Europe: A conflict between Lafarge and Holcim has deepened as both groups have acknowledged that the terms of their proposed 'merger of equals' may have to be revised to reflect diverging valuations, according to Reuters.

The merger 'Can no longer be pursued in its present form,' said Holcim said in a statement on 16 March 2015. It has proposed a renegotiation of the share exchange ratio and 'governance issues.' Lafarge is willing to consider revising the share-exchange ratio in the merger, but not other aspects of the deal, it said in a separate statement.

The deal announced in April 2014 was intended to combine Lafarge and Holcim on an equal basis, but diverging results, share prices and fluctuations in the Euro and Swiss Franc have led Holcim to seek a revision of the terms. Holcim has proposed changing a proposed 1-1 share exchange ratio to 0.875 Holcim shares for each Lafarge share, according to news reports. Lafarge is said to be planning a counter proposal that would trim its weighting to 0.93 to complete the deal.

Europe: Holcim and Lafarge are in talks to renegotiate the terms of their Euro41bn merger after a divergence in the value of the two companies over the past year. The two sides are holding discussions that might result in changes to the terms of the one-for-one share deal announced last April 2015, according to The Financial Times.

It in unclear how the renegotiation might affect CRH, which agreed in February 2015 to pay Euro6.5bn for assets being sold by the two companies as they sought to address potential competition concerns over the deal.

In recent weeks Holcim shareholders have raised concerns over the terms of the deal, most vocally a representative for the Schmidheiny family, which is Holcim's largest investor. Thomas Schmidheiny, head of the family and a former Holcim chairman, wanted the terms of the deal renegotiated. Holcim's second largest shareholder, Eurocement, which is owned by Russian Filaret Galchev and holds 10% of the shares, has not publicly supported the deal.

Europe: Holcim's largest stakeholder, Thomas Schmidheiny, wants a better deal for the Holcim's shareholders in its planned merger with Lafarge, according to Swiss Newspaper SonntagsZeitung, which cited people close to Schmidheiny.

The merger with France's Lafarge to create the world's biggest cement company was agreed on 7 April 2015, but analysts have since flagged a potential divergence between the two companies' earnings prospects, raising the possibility of a renegotiation of terms.

SonntagsZeitung said that Holcim board member Schmidheiny, who owns 20.1% of the company according to Thomson Reuters data, sees two possible solutions. One is to weigh the exchange ratio of shares in favour of Holcim investors. Another is a special dividend. The paper also quoted another board member as saying the deal will not work in its current form, which includes each Lafarge share being swapped for one Holcim share.

SonntagsZeitung has also reported that Swiss shareholder group Ethos, which represents around 200 pension funds, is against the deal as it stands and will tell Holcim's board that it will advise members to vote against the merger unless there is a change to the exchange ratio.

Europe: As announced on 7 April 2014, Holcim and Lafarge have entered into a business combination agreement on terms previously agreed, subject to various closing conditions. The transaction must be approved by 66% of Holcim's shareholders in an extraordinary general meeting, while 66% of Lafarge's shareholders will need to accept Holcim's exchange offer launched pursuant to French takeover rules.

Europe: Holcim is considering offering its shareholders a sweetener to win their approval for a planned merger with Lafarge, according to Swiss newspaper Sonntagszeitung.

Sonntagszeitung said that Holcim was looking at several 'creative methods' to sway its shareholders into backing the deal, including a generous special dividend or a share buyback, instead of trying to alter the terms of the deal, which involves a one-to-one share swap. However, Holcim's chief executive Bernard Fontana said that the merger agreement did not contain any mechanisms by which the terms could be automatically adjusted. Sonntagszeitung said that Holcim was considering the sweetener in response to opposition from its shareholders to the deal, which hinges on investor approval for a capital increase for financing.

Europe: Holcim's cement and clinker sales fell by 10.5% in Croatia and by 5.4% in Serbia in 2014. In Croatia, sales prices rose by 0.5%, while in Serbia, they rose by 0.3%. In contrast, Holcim's cement and clinker sales rose by 7.8% in Romania and by 2.4% in Bulgaria. In Romania domestic prices fell by 1.2%, while they rose by 1.1% in Bulgaria.

Europe: Holcim and Cemex have announced the successful closure of a series of transactions in Europe.

Holcim has acquired Cemex's operations in western Germany and the Netherlands, while Cemex has taken over Holcim Czech Republic with all of its subsidiaries in that country. In Spain, Cemex has purchased Holcim's Gador cement plant and Yeles grinding station, while Holcim keeps its remaining operations.

As a result of the transactions, Cemex paid Holcim Euro45m in cash. Holcim expects sustainable additional operating earnings before interest, taxes, depreciation and amortisation (EBITDA) of at least Euro10m/yr.

Europe: The European Commission (EC), the European Union's antitrust authority, has approved the proposed merger of Lafarge and Holcim, subject to asset sales by both companies in regions where their activities overlap. The EC's approval is conditional upon the divestment of Lafarge's businesses in Germany, Romania and the UK. Holcim is required to divest its operations in France, Hungary, Slovakia, Spain and the Czech Republic. The proposed transaction concerns assets worth several billion Euros and will create the world's largest cement producer with operations in 90 countries.

"The Commission had concerns that the transaction, as originally notified, would have had a detrimental effect on competition in a significant number of markets in the European Economic Area (EEA)," said the EC. "The commitments offered by the two companies address these concerns."

According to the EC, its assessment found that the merged entity would have faced insufficient competitive pressure from remaining players in many markets. This would have brought a risk of price rises. In order to prevent a negative impact on competition, the companies have committed to divesting most of the operations where their activities overlap. Further, the EC said that Holcim and Lafarge will not be allowed to close the deal until it has approved the buyers of the assets put up for sale.

In April 2014, Holcim and Lafarge announced their plan to combine through an all share merger of equals to create LafargeHolcim, with nearly Euro32bn in sales. The proposed combination would be structured as a public exchange offer initiated by Holcim for all outstanding shares of Lafarge on the basis of a 1 for 1 exchange ratio. The companies also agreed to have equal dividends on a per share basis between announcement and completion. The offer would be subject to Holcim holding at least 2/3rd of the share capital and voting rights of Lafarge.

Europe: Cemex has signed binding agreements with Holcim regarding the series of transactions that was originally announced on 28 August 2013.

The main scope of the transactions in Germany and the Czech Republic remain unchanged: Cemex will acquire all of Holcim's assets in the Czech Republic and will divest its assets in western Germany to Holcim. In Spain, Cemex will acquire Holcim's 0.85Mt/yr capacity Gador cement plant and its 0.9Mt/yr capacity Yeles cement grinding plant. Holcim will keep all of its other operations in Spain.

As part of these transactions, Cemex will pay Euro45m in cash to Holcim. Once the transactions are closed, Cemex expects a recurring improvement in its earnings before interest, taxes, depreciation and amortisation (EBITDA), including synergies, of about US$20m to US$30m. These transactions are expected to close during the first quarter of 2015.

Europe: Lafarge and Holcim are about to request approval from the European Commission (EC) for their planned merger, according to Lafarge CEO Bruno Lafont.

"We are indeed very close to EU notification," said Lafont. He added that talks with Brussels had been constructive and that the companies were 'well on track' to close the deal in the first half of 2015.