Mont Saint-Victor Le Teil Viviers Argillaceous Cement: Hydraulic Lime French Construction Aggregates Concrete
Mont Saint-Victor Le Teil Viviers Argillaceous Cement: Hydraulic Lime French Construction Aggregates Concrete
Mont Saint-Victor Le Teil Viviers Argillaceous Cement: Hydraulic Lime French Construction Aggregates Concrete
Lafarge was founded in 1833[2] by Joseph-Auguste Pavin de Lafarge in Le Teil to exploit the
limestone quarry in Mont Saint-Victor between Le Teil and Viviers. The limestone is white
and argillaceous, and yielded an eminently hydraulic lime. Lafarge is a French industrial
company specialising in three major products: cement, construction aggregates, and concrete.
The company has become a world leader in building materials. The group conducts its
operations through more than 1,000 subsidiaries, out of which 82% are consolidated. Further
to the divestment of a majority of its gypsum assets and the fundamental changes to its
management structure, the group has fully refocused on its core businesses of cement,
aggregates and concrete. The strategic shift will accelerate growth and innovation.
It has an organizational structure based on its three divisions, with decentralized local
operations and strong corporate expert departments, which are involved in strategic decisions.
Aggregates and Concrete: 1481 production sites and sales offices in 37 countries
performance,
value creation,
respect for employees and local cultures,
environmental protection,
Conservation of natural resources and energy.
reinforcing our position as the world leader in relation to our suppliers, employees,
customers and shareholders.
A multifocal organization: Lafarge's goals are local but remain integrated into our
global approach.
Holcim Ltd.
Holcim is a Swiss-based global building materials and aggregates company. Founded in
1912, the company expanded into France and then throughout Europe and Middle East during
the 1920s. They expanded in the Americas during the 1950s and went public in 1958. The
company continued to expand in Latin America and added Asian divisions during the 1970s
and 1980s. A series of mergers and buyouts made Holcim one of the two largest cement
manufacturers worldwide by 2014.
As of 2014, Holcim does business in more than 70 different countries and employees 71,000
people. The company is the market leader in cement production in Australia, Azerbaijan,
India, Slovakia, Switzerland, and Latin America.
Holcim's core businesses include the manufacture and distribution of cement, and the
production, processing and distribution of aggregates (crushed stone, gravel and sand), readymix concrete and asphalt. The company also offers consulting, research, trading, engineering
and other service. Holcim is a global company employing some 71,000 people, with
production sites in around 70 countries. With a market presence on every continent, Holcim is
more globally spread than any other building materials group, allowing us to create a strong
foothold in each individual market, and providing stable earnings for the Group.
Aiming to keep a balanced portfolio, Holcim's business strategy is based on continuous
growth in both developed economies and emerging, high-growth markets, where around
three-quarters of our operational capacity, accounting for almost half of the Group's net sales,
is based. In 2013, Holcim recorded net sales of over 19.7 billion Swiss francs. Thanks to our
market-oriented structures, product innovations, skilled employees and efficient
environmental management systems Holcim is in a strong position now - and for years to
come.
Our key objective is the creation of value. We attach great importance to sustainable
development at an economic, ecological and social level. By taking this holistic approach, we
can secure the company's long-term success. The basis for this is an exceptional operational
performance and a solid return on the capital invested. Our approach has been acknowledged
by the Dow Jones Sustainability Index. Holcim Ltd strives to be one of the leading companies
in sustainability worldwide. The Group has been reconfirmed as a member of the DJSI World
Index in 2012/2013 in the building materials industry. Holcim has now been included in both
the Dow Jones Sustainability World Index and the Dow Jones STOXX Sustainability Index
for eleven years, demonstrating our ongoing and long-term commitment to sustainable
development.
1. Exploiting synergies and curtailing losses: Since cement is a low value bulky
commodity, there exists a significant scope of rationalising costs where the two
companies have a significant overlapping of capacities. For e.g. the two entities have
a large overlap of operations in Europe, North America and Asia Pacific where we
believe they could be looking at exploiting synergies particularly in area of fixed cost
rationalisation, supply chain and energy. The companies are expecting potential
synergies of EUR 1.4 bn or ~USD1.9 bn in a phased manner over next three years.
The synergies will enable the combined entity to curtail losses at some from their loss
making kilns.
2. Improving consolidation in Europe and balancing presence in emerging markets:
The merger would improve the level of consolidation in key markets like Europe,
North America, Middle East and Asia Pacific, thereby helping the pricing power in a
highly price sensitive commodity. Further the merger would be complimentary and
would help the two entities in balancing their presence particularly in emerging
markets. For e.g. Lafarge derives 27% of its revenues from Africa and Middle East
but only 6% from Latin America. While Holcim derives an impressive 36% from Asia
pacific and 17% from Latin America.
3. Optimizing capital allocation, enhancing cash flows and de-leveraging balance
sheet: As mentioned earlier the two entities have significant overlap in Europe, North
America and Asia Pacific. Hence we believe in eventuality of their merger, the joint
entity would look to optimize capital allocation by curbing their Capex program in
large overlapping geographies and enhance the efficacy of the synergy benefits to
generate higher free cash flows to de-leverage their stretched balance sheets.
4. Improving Credit Rating: Moodys Investors Service rates Lafarge Ba1 and Holcim
two levels higher at Baa2. Hence a meaningful cost savings for the combined entity
and Holcims better credit rating will help Lafarge save on the interest cost.