Lafarge’s Lafont favors cement insider at Holcim tie-up CEO

Lafarge boss Bruno Lafont wants someone with experience of the cement industry as chief executive of the French group’s planned tie-up with Swiss peer Holcim, according to newspaper Le Monde.

The choice for CEO for what would become the world’s largest cement maker is still unresolved after revised merger terms last month gave Lafont the role of non-executive co-chairman instead of chief executive as initially planned.

Lafont is due to propose a CEO candidate within the next two weeks ahead of a special May 8 shareholder meeting called to ratify the merger deal.

Lafont, in a Le Monde interview published Saturday:

“For me, there should be a leader able to drive and unify the teams, a cement expert who already has good knowledge of the industry and the company, and with a true culture of value creation for shareholders.”

Gerald Lamarche, Groupe Bruxelles Lambert joint managing director, to the Financial Times:

“So it should be someone with different experience and with an international profile.”

The reworked merger proposals gave a more attractive share-swap ratio for Holcim shareholders but left the choice of CEO pending.

The revised terms have failed to satisfy Holcim’s second-biggest shareholder, Russian businessman Filaret Galchev, as he wants to reopen questions on the exchange ratio, according to sources at his Eurocement holding firm.

Lafont:

“The financial parties are not going to change, nor will the governance.”

The adjusted share-swap ratio, which will see Lafarge shareholders receive nine Holcim shares for every 10 Lafarge ones and not the one-for-one ratio previously proposed, reflected a shift in market conditions since the deal was first unveiled a year ago but preserved the principle of “merger without equals,” according to Lafont.

Holcim Chairman Wolfgang Reitzle has also opposed revising the financial terms again, but said this week that he is open to Eurocement having a seat on the merged company’s board.

Lamarche:

“I think there is nothing else to discuss. Eurocement is a shareholder like all the other ones.”

Source: Reuters

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