Holcim-Lafarge rescue mega merger after agreeing to new terms

Cement giants Holcim and Lafarge have rescued their over USD 40 billion mega merger with a new set of terms, resurrecting the deal from a near collapse earlier this week.
"Both parties agreed in a new exchange ratio of 9 Holcim shares for 10 Lafarge shares," the Swiss building material major Holcim said in a statement today.
Lafarge shareholders would now receive nine Holcim shares for every 10 Lafarge shares they hold. The deal unveiled in April last year was based on one-for-one ratio.
"With this amended agreement, project to combine Lafarge and Holcim to become the most advanced company in its industry has taken another important step forward. Both companies are continuing to work intensively on preparing the closing of the transaction and the successful integration post-merger," it added.

A new CEO for the combined group, to be proposed by the Lafarge Board and accepted by the Holcim Board, will be appointed as from the closing of the transaction, the statement said.
The appointment is expected to be communicated in due course, at the latest upon filing of the public offer to the Lafarge shareholders. Wolfgang Reitzle and Bruno Lafont will be non-executive Co-Chairmen of the Board. The two Co-Chairmen will be working closely together to make this merger a success. Beat Hess will be Vice-Chairman of the Board.

The much-hyped merger to create world's largest cement firm hit a roadblock couple of days back with Swiss giant Holcim rejecting the deal with its French counterpart in the present form, including on "governance issues".

Plans to combine Holcim and Lafarge, both of which have significant capacities in India, were announced in April 2014. The combined entity would have sales of USD 40 billion and operations in 90 countries.
"I am very pleased that we are now able to proceed with our project to create a truly outstanding global leader in building materials. Bruno Lafont (Lafarge Chairman) and I will work closely together to ensure that value creation potential of this merger will be realised for the benefits of all shareholders," said Holcim Chairman Wolfgang Reitzle.
Lafont said the new company will gather best-in-class teams in the sector with the strength of two combined firms.

Certain key shareholders of both companies have confirmed their support for the revised merger terms. The parties expect the transaction to close in July, 2015.