LafargeHolcim to exit Chile with sale of Cemento Polpaico
10 Oct 2016
Cement giant LafargeHolcim is exiting Chile by selling its majority stake in Cemento Polpaico to investment firm Inversiones Caburga Limitada, for $225 million (220 million Swiss franc).
The sale is part of the company's plans to divest 5 billion Swiss francs worth of non-core assets by the end of 2017.
Caburga will buy LafargeHolcim's 54.3-per cent stake in Cemento Polpaico via a public tender offer.
Cemento Polpaico operates one integrated plant and two grinding plants with an annual cement capacity of 2.3 million tonnes.
The company is also a leading ready-mix concrete producer operating 25 plants and produces aggregates.
Post closing, LafargeHolcim will exit Chile completely.
The launch of the public tender offer is subject to the approval of the Chilean competition authorities which is expected for the first half of 2017.
LafargeHolcim said that it has exceeded its divestment target of CHF 3.5 billion for 2016.
The Switzerland-based company had in August announced that it would be extending the program to CHF 5 billion which it expects to complete by the end of 2017.
In 2014, two of the world's biggest cement companies, Holcim of Switzerland and Lafarge of France agreed to merge, creating the world's biggest cement maker, with a market cap of $50 billion and annual sales of nearly $43 billion. (See: Cement giants Holcim and Lafarge announce merger of equals)
The mega deal saw the two companies selling assets in Western Europe, Canada, the US, Brazil, India, Serbia, Romania, Hungary, Morocco, Philippines and China in order to obtain regulatory approval for the merger.