Friday, March 20, 2015

LEAD 4-Lafarge and Holcim agree, the merger will be looped in July – Challenges.fr

* New exchange ratio of 0.9 share for Lafarge Holcim

* Bruno Lafont non-executive co-chairman of the new group

* The agreement does not say whether the Future DG subsequently proposed by Lafarge, the French group will

* The vice president will Holcim Vice President LafargeHolcim

* Support of key shareholders to the revised terms of fusion (Updated with clarifications and ongoing)

by Gwénaëlle Barzic and Gilles Guillaume and Oliver Hirt

PARIS / ZURICH, March 20 (Reuters) – Lafarge and Holcim have agreed to revise their plans to create the world’s largest cement manufacturer, but if they have satisfied the shareholders of the Swiss group by improving the terms of their merger they leave pending a key issue for the management of the future together.

If the wedding is back on track after a few weeks of doubt and must now be celebrated in July, instead of the end of the first half, the contract is at risk if the two groups did not differ on the personality of the person who will the General Director.

After several days of intense negotiations, Lafarge and Holcim agreed to a new, more favorable exchange parity to the Swiss group, the soaring franc and prospects more favorable results on the side of Holcim having changed the game since the announcement of the merger in April 2014.

The exchange ratio was reduced to 0.9 Holcim Lafarge share for share, in Instead of parity, which will give Holcim almost 56% of the future together and 44% to Lafarge, against 53% -47% in the original scheme.

On governance, the Swiss side also been successful. She no longer accepted, according to sources familiar with the matter, the CEO Lafarge Bruno Lafont is managing director because of his past performance as head of the French group and its management style. Bruno Lafont not ultimately provide this function, but will be Non-Executive Co-Chairman in the current Holcim next president Wolfgang Reitzle.

AN AMERICAN IN THE GAME?

The CEO will be appointed in the coming weeks on a proposal from Bruno Lafont and Lafarge’s board. It was not clear if he would be selected from Lafarge or externally.

“Does it come from Lafarge? What is very important is to say, Lafarge is going to offer this candidate, “said Bruno Lafont during a press teleconference. “Of course it will be ratified by Holcim.”

A source close to the matter said that the choice of the CEO should be sealed in time for the general meeting of shareholders scheduled for May 7 Holcim .

“Governance is still totally balanced,” said Bruno Lafont, considering that the new agreement with the spirit of the “merger of equals” of the original project.

No indication has not filtered on the nationality of the future CEO.

“If we are asked our opinion, we will say that there is this thing between the French and Swiss (.. .) Perhaps one or two egos, “said on condition of anonymity one of Lafarge. “It might be interesting that an American enters the game, cultural differences that persist perhaps we could then exceed them.”

In the future LafargeHolcim shared presidency will add a vice -president the board, a position entrusted to Beat Hess, vice president of Holcim.

The balance in the board between the two groups, which will each have seven seats, has not changed.

“The two councils have managed to find a fit, but will it be enough to convince shareholders? The history not stop here,” said Bernstein in a note.

DIVIDEND PROMIS AFTER MERGER

Bruno Lafont said the agreement was unanimously approved by the Lafarge board.

Refuting “any fundamental change” of the original agreement, he stressed that he would work alongside Wolfgang Reitzle to the implementation of the operation which, he has said, it is not surprising in view of its size, it has a number of “tensions” and “tensions”.

“My attitude since Sunday is to show that men should not block the completion of this merger, “said he said.

In the Paris Stock Exchange, Lafarge and Holcim shares abused early in the week have regained color. They take 2.8% and 0.8% in early afternoon.

In their statement, Lafarge and Holcim out that several key shareholders have given their support to the new terms of the transaction .

LafargeHolcim announce after the closing of the transaction, a dividend payable in shares of one new share for 20 shares held LafargeHolcim.

The main shareholder of Holcim, Thomas Schmidheiny , welcomed the terms of the new agreement. Asked about his intentions, a spokesman of the Russian Filaret Galtchev second shareholder of Holcim Eurocement Holding through, refused to comment. (With Olga Sichkar in Moscow and Sinead Cruise in London, edited by Dominique Rodriguez)

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