Lafarge SA and Hong Kong-based Shui On Construction & Materials Ltd will apparently merge their cement operations in a joint venture in China, the companies said in a statement Thursday. Shui On Construction, also known as Socam, is the leading cement producer in southwest China.
"The strategic alliance will establish the new cement leader in the South West Region, one of the largest and fastest growing areas in the Chinese Mainland," the companies said. The joint venture, to be named Lafarge Shui On Cement, will be 55 per cent owned by Lafarge and 45 per cent owned by Socam.
The companies said Lafarge Shui On Cement will combine Lafarge’s cement operations in the Chinese mainland, located in Sichuan, Chongqing and Beijing, with Socam’s cement operations in Chongqing and Sichuan, larger plants in Guizhou, and the prospective acquisition of several plants in Yunnan, which is awaiting approval from government authorities.
The total capacity of the joint venture will be 17.4Mta by the end of 2005 including Yunnan, a key province in southwest China. The region has a high growth potential with a population of more than 200 million people and extensive infrastructure development plans.