January 28, 2024

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Switzerland’s Holcim plans separation of US cement business

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The Swiss cement giant Holcim is near a deal to separate out its North American business, according to people familiar with the matter.

The company could announce its plans in the coming days, the people said, adding that the North American business could eventually be listed in the US.

Based in Zug, Holcim is the result of a 2015 merger between France’s Lafarge and Switzerland’s Holcim that created the world’s largest cement company. Holcim trades at a market capitalisation of about 37.2bn CHF ($43.1bn).

In its first-half results last year, Holcim said that North America was set to contribute around $12bn of net sales in 2023, representing about 40 per cent of the group’s total.

It added that it was North America’s leading cement supplier, and a top provider of commercial flat roofing and concrete. The company has about 350 locations across 43 states in the US and employs 7,000 people, according to its website.

Since its own merger almost a decade ago, Holcim has remained active in dealmaking.

In 2022, Holcim agreed to sell its Indian businesses to Adani Group for $10.5bn in cash.

The previous year, the group agreed to buy Firestone Building Products from Japan’s Bridgestone Corporation for $3.4bn to strengthen its position in the US. The deal was intended to help Holcim break into the lucrative flat roof market.

European companies have looked to US listings for the higher valuations and greater market liquidity and analyst coverage they can bring.

CRH, the world’s largest building materials group, last year moved its primary listing from London to New York.

Holcim did not respond to immediate requests for comment. The WSJ first reported Holcim’s plans.

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