The transaction is part of a global agreement for the acquisition of some of the assets of Lafarge and Holcim for a total EUR6.5 billion, in the context of the merger of the two groups in France and Switzerland, respectively. CRH said the decision to buy Lafarge assets in Romania proves confidence in the good results achieved by the former units of French group Lafarge.
Lafarge Ciment, the main company through which French Lafarge operated in Romania, reported a turnover of EUR155 million in 2014. Irish firm CRH took over from Lafarge, among others, its two cement factories in Romania, in Medgidia and Hoghiz, and its grinding station in Targu-Jiu. Lafarge Romania’s consolidated turnover rose to nearly EUR200 million in 2014.
On a global level, the transaction will double CRH’s cement production capacity and expand its portfolios of aggregates and ready-mix concrete. Consequently, CRH will become, according to its own data, the world’s third largest player on the building materials market and second largest on the aggregate market.
The acquired operations include the largest cement producer in Eastern Canada, major cement and aggregate operations on the largest markets in Western Europe (Great Britain, France and Germany), along with the main cement and aggregate manufacturing companies in developing regions in Central and Eastern Europe.
CRH shareholders approved the transaction in March 2015 and the European Commission gave its approval in April.
In July 2015, Holcim and Lafarge have successfully completed their merger and created LafargeHolcim, the world’s leading building materials company, with annual sales of approximately EUR40 billion. The two companies decided to sell the assets of one company in Romania, Germany and Hungary. In Romania, the assets up for sale are those of Lafarge.
Early February 2015, CRH reached an agreement with Holcim and Lafarge to acquire the bulk of assets the two companies were selling, including those in Romania, for EUR6.5 billion. Lafarge’s two cement factories in Romania, in Medgidia and Hoghiz, and its grinding station in Targu Jiu, were going to be taken over by Irish manufacturer CRH.
Following the transaction, the Romanian cement market will still be dominated by three large players – the new entity LafargeHolcim, Germany’s HeidelbergCement and Ireland’s CRH. The Romanian cement sector is valued at approximately EUR500-600 million per year.