China: LafargeHolcim to sell stake in Shuangma Cement

LafargeHolcim has announced that it has signed a deal with Tianjin Circle Enterprise Management Centre that would see the Franco-Swiss multinational sell a 55.93 per cent stake in Sichuan Shuangma Cement for CHF507m (US$525m).

Subject to shareholder approval, the acquisition is expected to be completed by 4Q16. Following the sale, Lafarge will retain a stake of around 20 per cent in Shuangma. The agreement reached with Tianjin Circle leaves open the possibility – until 2018 – of either party initiating the transfer of this remaining stake, either a price that reflects today’s deal or for an aggregate consideration of CHF159m (US$165m).

Furthermore, LafargeHolcim retains an option to repurchase Shuangma’s cement assets at a price of CHF387m (US$400m). The immediate impact of all these deals is a reduction in LafargeHolcim’s debt stock of CHF121m (US$125m).

Shuangma Cement operates four integrated plants in Sichuan with a combined capacity of 11Mta.