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Two of the world's largest cement makers, France's Lafarge and Switzerland's Holcim, had agreed on the terms of a merger that would create a company with a stock market value of around $55 billion, a source close to the situation said on Sunday.
Such a merger would be the industry's biggest-ever tie-up and create an entity with combined annual sales of $40 billion, raising the likelihood it will draw extra scrutiny from global competition watchdogs. Lafarge and Holcim had approved the proposal and were to announce it on Monday, the source said.
The two groups have already begun to address possible competition concerns that would arise, the source added. "The boards (of Lafarge and Holcim) met yesterday and approved the proposal... An official communication is due on Monday."
Lafarge declined to comment. Holcim was not immediately available for comment. The two firms had issued statements on Friday announcing they were in advanced talks to merge, a deal that would help them slash costs, trim debt and better cope with the soaring energy prices and weaker demand that have hurt the sector since the 2008 economic crisis. Their share prices jumped to four-year highs on the news, lifting the entire cement sector.
