Holcim agrees merger with Lafarge, set to rival Dangote in cement market

The merger, which was reportedly executed to meet the dominance of the cement market in Africa, by the Dangote Group, was initially faulted by shareholders of Holcim Nigeria as having been carried out without being taken into confidence.

The company later resolved to remain as an independent competitor within Lafarge.

But six months into the merger, Holcim Nigeria board was subsumed into LafargeHolcim, in a move aimed at boosting the new outfit as Lafarge Africa to compete as a cement maker, with Nigeria as its main base.

However, LafargeHolcim Chairman, Beat Hess, on Tuesday stated that the company had started adjusting its structures towards the plan by Holcim Nigeria to exist in Nigeria with effect from August 2017.

Observers of the development said the move would have two-sided effects in the industry.

Read also: Angry Arewa youths call Dangote a scavenger, moral liability to the North

They said the subsidiaries of Holcim Nigeria, which are into other services in the country will cease to function with a yet-to-be known workforce to be lost.

“The winding down of Holcim Nigeria will on the other hand help in consolidating Lafarge into a strong holding to withstand the competition in the cement market in Nigeria and Africa, generally,” said Hess.

He said the big markets, where both Lafarge and Holcim are presently following up will with the full merger be to the interests of both the investors and other stakeholders.

The cement company confirmed it will present the final accounts of Holcim Nigeria as part of the voluntary winding down process at a meeting of shareholders on August 21.

The cement company, after the pull out of Holcim Nigeria is also expected to go to the capital market to raise N140 billion in fresh equity.

The process will see some of its loans converted into shares as part of a planned rights issue, as a follow up to some losses of 2016.

With the new arrangement, LafargeHolcim will seek to restructure the ownership of the firm’s 73 per cent stake-holding in the hands of foreign investors.

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