Nirma signs agreement to buy Lafarge India’s cement business
The world's largest soda ash manufacturer Nirma has signed an agreement to purchase cement business of Lafarge India for $1.4 billion (nearly Rs. 9,400 crore).
LafargeHolcim announced that it has entered into a letter agreement with Nirma Limited subject to approval by the Competition Commission of India (CCI) for the divestment of its interest in Lafarge India for an enterprise value of approximately USD 1.4 billion. Lafarge India operates three cement plants and two grinding stations with a total capacity of around 11 million tonnes per annum. The company also markets aggregates and is one of India’s leading ready-mix concrete manufacturers. The proceeds from the divestment will be used to reduce debt further.
Eric Olsen, CEO, said “This agreement is an important step in our CHF 3.5 billion divestment program. With this deal, two thirds of the program has been secured and the remainder of the program is well on track. We are confident that we will meet our target by the end of this year. With the proposed buyer we have found the right partner who will be able to develop the business further in the interest of all our stakeholders.”
LafargeHolcim will continue to operate in India through its subsidiaries ACC Ltd. and Ambuja Cements Ltd. with a combined cement capacity of more than 60 million tonnes and a distribution network that extends across the entire country.
The transaction with Nirma Limited as a purchaser will be submitted to the CCI for approval.
LafargeHolcim has a divestment target of CHF 3.5 billion in 2016 and has already completed the sale of its business in South Korea and signed an agreement to divest its minority shareholding in Saudi Arabia. The Group has also expanded its joint-venture with SNI, its historical partner in Morocco, by merging Lafarge Ciments Maroc and Holcim Maroc to create LafargeHolcim Maroc.