Displaying items by tag: Lafarge

US/Canada: Lafarge and Holcim have received final approval for their proposed merger from the competition authorities in the US and Canada. All competition approvals necessary for closing the transaction have now been obtained ahead of the expected closing in July 2015.

Following the regulatory assessment in all key jurisdictions, Holcim and Lafarge can now present a final list of divestments to satisfy regulatory requirements. These divestments remain subject to the completion of the merger, including a successful public exchange offering to Lafarge's shareholders and approval by Holcim's shareholders.

France: Lafarge has reported a loss for its net income of Euro96m for the first quarter of 2015, an improvement from a loss of Euro135m for the same period in 2014. The multinational building products manufacturer blamed the loss on seasonal factors and noted that it had been 'significantly' reduced due to operational performance and cost cuts. Otherwise, sales rose by 6% year-on-year to Euro2.78bn from Euro2.63bn. Volume of cement sold fell by 4% to 25Mt from 25.9Mt.

"Our markets are developing in line with our expectations and growth shall accelerate gradually in the coming quarters. We reaffirm our expectation of cement volume growth of 2 to 5% in our markets in 2015. We also confirm our target to significantly grow our operational results with an expected underlying earnings before interest, taxes, depreciation, and amortisation (EBITDA), excluding the impact of the planned merger with Holcim, of between Euro3bn and Euro3.2bn in 2015," commented Bruno Lafont, chairman and chief executive officer of Lafarge.

Regional sales were affected both positively and negatively by currency exchange variations and divestments of assets. Notably, cement sales volumes fell by 8% to 2.4Mt and sales revenue fell by 9% to Euro457m in Western Europe, principally due to lower volumes in France. Cement sales volumes fell by 6% to 9.9Mt but sales revenue rose by 9% to Euro972m in Middle East and Africa. Volumes in this region were affected by transport limitation in Iraq and the suspension of operations in Syria. Asia continued to show both improving sales volumes and revenue in the quarter.

World: Lafarge has signed an agreement with Solidia Technologies to sell its low-carbon cement and CO₂-cured concrete worldwide. Under the terms of this agreement, Lafarge will have the right to commercialise the process that reduces the carbon footprint of the end-to-end process by up to 70%. The commercial launch will initially take place in some key markets in North America and in Europe for the manufacturing of concrete elements such as paving stones, roof tiles and concrete blocks.

Solidia has developed a new binder made from similar raw materials to Ordinary Portland Cement and produced in a traditional rotary kiln. It is produced at lower temperatures and through a different chemical reaction that generates less CO₂. Used afterwards in the manufacture of precast concrete, Solidia Cement hardens through the addition and absorption of CO₂ in a patented curing process that reduces the overall carbon footprint by up to 70%. Produced at traditional precast concrete manufacturing facilities, Solidia Concrete reaches full strength in less than 24 hours.

Lafarge has worked with Solidia Technologies since 2013 to industrialise this technology. In April 2014, a joint group of Lafarge and Solidia scientists confirmed the reduced carbon footprint and commercial viability of Solidia cement during a full-scale trial at Lafarge's Whitehall cement plant in the US. The cement produced has subsequently been used by a variety of pre-cast customers in North America and Europe to further validate Solidia's curing technology and to produce blocks, pavers and roof tiles for commercial testing. In December 2014, Lafarge invested in Solidia Technologies and joined Solidia's Board of Directors.

Europe: CRH has been approved by the European Commission as a purchaser of assets in the European Union from Lafarge and Holcim. CRH has also received from the European Commission the clearance for the acquisition of these assets. These divestments remain subject to the completion of the merger between Lafarge and Holcim, including a successful public exchange offering to Lafarge's shareholders and approval by Holcim's shareholders.

In France Holcim and Lafarge are divesting all of Holcim's assets, except for its Altkirch cement plant and aggregates and ready-mix sites in the Haut-Rhin region, and a grinding station of Lafarge in Saint-Nazaire. Lafarge's assets on Reunion island are being sold except for its shareholding in Ciments de Bourbon. All of Lafarge's assets are also being sold in Germany and Romania. Lafarge Tarmac assets in the UK are being sold with the exception of its Cauldon and Cookstown plants and certain associated assets. In Hungary all of Holcim's operating assets are being divested and it is selling its assets in Slovakia.

Pakistan: Bestway Cement, a subsidiary of Bestway Group, has announced assumption of management control of Lafarge Pakistan. This follows the company's successful bid for 75.86% of Lafarge Pakistan's shares for US$329m in July 2014. Bestway Cement also acquired another 12.07% shares of the target company through the public offer process taking its shareholding in Lafarge Pakistan to 87.93%.

Acquisition of Lafarge Pakistan's 2.5Mt/yr cement plant located in Chakwal, means that Bestway Cement has now become the largest cement manufacturer in Pakistan with a total capacity of more than 8Mt/yr representing 18% of the entire industry's capacity in the country. Bestway intends to invest nearly US$30m in the acquired company including, among other things, an environmentally friendly waste heat recovery power plant.

Cameroon announced this week that it intends to ban imported cement to aid the sales from the new Dangote owned cement plant in the country. Readers should note that Dangote is a Nigerian-based company. Protective legislation such as this should come as no surprise given the rise of Nigeria's own cement industry and similar initiatives in that country. The difference here, however, is that the Cameroonian government is protecting investment by a foreign company rather than propping up any home grown concerns.

The new Dangote-run cement plant in Douala will start with a cement production capacity of 0.95Mt/yr with the intention to rise to 1.5Mt/yr in 2016. A meet-and-greet by company officials with local press in early April 2015 revealed that the company intends to snatch 30% of the local cement market in 2015 with prices primed to just undercut the other major producer.

What then of the country's two other integrated cement plants? Both have foreign ownership. Cimenteries du Cameroun, with a 1Mt/yr plant, is a subsidiary of France-based Lafarge. Ciments de L'Afrique, with a 0.5Mt/yr plant, is a Moroccan firm. Add the new 1.5Mt/yr Dangote cement plant and domestic production in Cameroon is anticipated to exceed local demand.

When this happens how will the Cameroonian government view the two non-Dangote producers who may well be importing clinker and other products into the country for their operations? If the experience of Nigeria is a model then a 'self-sufficiency' battle may ensue in the media. Alongside this the price of cement may well stay fairly stable despite any alleged 'gluts'. This week, for example, the Cement Producers Association of Nigeria has lobbied the President-elect of Nigeria, Muhammadu Buhari, to cut the price of cement by half. The hypocrisy during the Nigerian spat over imports was that Nigeria wanted (and has become) a cement exporter.

At the time this column asked how that could work if imports at the time were so much more competitive that they had to be banned at home. Then as now deals seem to mark the way. At that time, in early 2013, Liberia relaxed its tariffs on cement just as Dangote was building a new plant there. Now, in Cameroon, once again Dangote appears to be negotiating some form of preferential treatment.

At the root of these issues, Cameroon's citizens and industry want to build and develop their country. Cheaper cement will enable them to do this by pushing up per capita cement consumption. Protecting their domestic industry or those that have invested in the country may not necessarily lead to cheaper cement.

Poland: Lafarge has appointed Jacek Patyk as new director of the Malogoszcz cement plant. He will replace Miroslaw Majchrowicz, who will be in charge of Lafarge's cement plant in Beocin, Serbia

US: Lafarge and Holcim have announced further details on the package of assets that they propose to divest in the US as part of their planned merger to create LafargeHolcim. The divestments include:

- Lafarge's 1.1Mt/yr Davenport cement plant in Iowa and seven terminals along the Mississippi River. The units will be sold to Summit Materials for US$450m in cash plus Summit's Bettendorf, Iowa cement terminal;
- Holcim terminals in Michigan and Illinois;
- Holcim Skyway 600,000t/yr slag grinding station in Illinois;
- Holcim Camden 700,000t/yr slag grinding station in New Jersey, along with a terminal in Massachusetts.

The proposed divestments have been negotiated with the staff of the Federal Trade Commission and remain subject to review and approval by the commission. The divestments will be completed subject to acceptance by the commission and to the closing of the merger between Holcim and Lafarge.

Europe: On 14 April 2015 Holcim announced the names of the candidates proposed to join the board of directors of LafargeHolcim after the merger. The board will comprise 14 members, seven each designated by Holcim and Lafarge.

After the announcement, Holcim received a proposal in writing of its 10.8% shareholder Eurocement to elect Filaret Galchev to the board of directors of LafargeHolcim. According to Holcim, the proposal came too late to be considered by the board of directors of Holcim for inclusion into the agenda of the Extraordinary General Meeting on 8 May 2015.

Europe: Eurocement Holding AG, the second-largest shareholder in Holcim with a 10.8% stake, has said that it is nominating its owner Filaret Galchev for a position on the LafargeHolcim board. Galchev's name was not on a list of candidates for the post-merger board released earlier in April 2015, but Holcim's chairman had previously said that Holcim was open to giving Galchev a seat.