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Holcim eyes billion-franc Aggregate deal

Holcim is pondering a major acquisition in Britain Keystone

The Swiss cement producer, Holcim, is in talks about making an offer for Britain’s Aggregate Industries.

This content was published on January 12, 2005 - 09:54

Any planned offer would value the British company at £1.78 billion (SFr3.94 billion).

Holcim, the world’s second-largest cement maker, said the two companies were discussing an offer of 138 pence per share and a two pence interim dividend, subject to due diligence checks.

Holcim and Aggregate said the outcome of their talks was still uncertain, although the board of directors of the British materials firm said it would be prepared to recommend the offer.

“The Board of Aggregate Industries would be minded to recommend such an offer by Holcim if made,” Aggregate said in a statement on Wednesday.

At Holcim headquarters in Zurich, spokesman Roland Walker told swissinfo that he could legally make no comment on the talks until a firm offer was on the table.

Analysts said the high offer would ensure there would be no bidding war for the British company.

They added that the takeover would give Holcim a foothold in the British market, where it currently does not have a presence.

Cash and credit

In a statement, the company said that it would finance any transaction with existing cash balances and new committed credit facilities.

Citigroup Global Markets is advising Holcim on the proposed deal, while Greenhill and Co International is acting for Aggregate, the companies said.

Aggregate has spent £100 million in acquisitions in a year, including Frehner Construction Company of Las Vegas, one of the fastest-expanding cities in the United States.

Holcim has been seeking targets amid consolidation in the global building and construction industry.

Shares in Aggregate have jumped 37 per cent in six months valuing the company at £1.47 billion. The stock on Tuesday added 25 per cent.

However, Holcim shares closed 2.6 per cent down at the Zurich stock exchange.

Holcim made a net profit of SFr691 million in the first nine months of 2004, on sales of SFr10 billion.

swissinfo with agencies

Key facts

Holcim, formerly Holderbank, is the number two player in the cement and aggregates market after Lafarge of France.
Net profit at Holcim rose by 35.6% in 2003 to SFr686 million on sales of more than SFr12 billion.
Active in more than 70 countries, Holcim employs 48,000 people.

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