Lafarge, Shui confirm new joint venture

Lafarge and Shui On Construction And Materials Limited, the top cement producer in southwest China, have formed a joint venture partnership to merge their cement operations in China. The joint venture, to be named Lafarge Shui On Cement, will be 55 per cent owned by Lafarge and 45 per cent owned by Shui On, according to Bruno Lafont, chief operational officer of Lafarge.

The new company, with a yearly capacity of 17.4Mt and a capital of US$800m, is one of the largest cement producer in the country. It plans to add a new investment of US$100m over the short term.

Lafarge Shui On Cement will combine Lafarge’s cement operations in the Chinese mainland, located in Sichuan, Chongqing and Beijing,with Shui On’s cement operations in Chongqing and Sichuan, its larger plants in Guizhou, and the prospective acquisition of several important plants in Yunnan, which is awaiting approval from the central government authorities.

Southwest China has a high growth potential with a population of more than 200 million people, a rapid pace of development and extensive infrastructure development plans, said Mr. Lafont, who is also the designated chief executive officer of Lafarge and willtake the position on January 1, 2006.