Lafarge: Materis restructuring

Lafarge is selling its stake in building materials group Materis to LBO France. This deal should be seen as part of Lafarge’s promised debt reduction programme post the Blue Circle take-over.

Lafarge is selling its stake in building materials group Materis to LBO France, as are its financial partners CVC Capital Partners, Advent International and Carlyle.  Materis was set up in 2001 by Lafarge with the three financial partners in order to strengthen the Lafarge balance sheet ahead of the acquisition of Blue Circle Industries and acquired the main parts of Lafarge’s speciality products division for €890m.  It appears to be the intention of all four vendors to invest, along with LBO France in a new company that is to take over the undertakings currently controlled by Materis, which include notably the Lafarge Aluminates calcium aluminate cement business that is the global leader in its field.  Lafarge will receive €210m for its stake in Materis and will invest €20m in the new company, in which it will have an equity interest of around 7 per cent - compared with a 33 per cent stake in Materis.  This deal should be seen as part of Lafarge’s promised debt reduction programme post the Blue Circle take-over that in recent months have also seen the divestment of the group’s cement operations in Florida, to Florida Rock Industries, and in Andalusia.