EU Approves Lafarge-Holcim Merger To Form Cement Titan
"Acquisition of Lafarge by Holcim is subject to conditions. The merger can proceed," EU Competitors Commissioner Margrethe Vestager said on Twitter, adding the move was "good for progress".
The European Commission said it allowed the merger to go ahead on condition 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 introduced in April they were merging to create the world's biggest cement group worth forty billion euros ($55 billion), with an eye on booming construction in rising markets.
The deal, a significant occasion within the world development trade, relies on the provide of 1 Holcim share for one Lafarge share.
The new company will likely be called LafargeHolcim and "can have a unique position in 90 countries and will probably be evenly balanced between creating international locations and nations with sturdy growth," the corporations said in a joint statement.
They highlighted the match of their actions since Lafarge has a strong presence in Africa and Holcim in Latin America.
However they each have big and competing interests in Europe.
The European Commission said it had had considerations that the "transaction, as originally notified, would have" hurt competition in many markets in Europe but that the 2 corporations later "committed to divesting a lot of the operations where their actions overlap".
"With the cures, we now have 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 example at the moment's approval provides to other companies which will have global ambitions," she said.
The Commission added that the two firms will not be allowed to complete their deal till it has approved the companies who will purchase the assets put up for sale.
- 'Nice satisfaction' -
Figures showed that the new big will employ 136,000 people, 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 might be in a strong place as a supplier of cement, a key basic materials in construction.
Building provide corporations have been increasing in emerging nations the place they see huge 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 fee's constructive choice," said Wolfgang Reitzle, the longer term chairman of LafargeHolcim, and Bruno Lafont, the future chief executive officer, in a joint statement.
"Due to this approval, we stay more than ever on the fitting path to finalise the merger within the first half of 2015."
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