MANILA, Philippines - Cebu-based conglomerate Aboitiz Equity Ventures Inc. (AEV) and the Ireland-based CRH have signed an amended agreement with respect to the sale of Lafarge Republic Inc.
In a disclosure to the Philippine Stock Exchange (PSE), AEV said the amended investment agreement covers an additional acquisition of an equity stake in Lafarge Iligan Inc. and Lafarge Mindanao Inc. (LMI).
AEV said the two companies will remain as subsidiaries of Lafarge.
The listed holding firm expects to complete the acquisition of Lafarge within the second half of the year.
AEV and CRH initially entered into an exclusivity and non-binding memorandum of understanding to acquire the Philippine assets and business of Lafarge including its cement production.
The estimated total investment of AEV in the transaction is approximately P24 billion.
Swiss-company Holcim Ltd. and Lafarge S.A. have merged and launched on Wednesday a $43.2 billion combined building materials company.
According to its website, Lafarge Philippines has a nationwide manufacturing network of four cement plants in Norzagaray, Bulacan; Teresa, Rizal and Taysan, Batangas. It also owns one grinding station in Danao, Cebu; a cement plant through subsidiary Lafarge Iligan and an aggregates quarry in Angono, Rizal, through subsidiary Lafarge Republic Aggregates.
CRH, which has operations in 34 countries, is a manufacturer, supplier, and distributor of building materials with headquarters in Dublin, Ireland.
AEV’s entry into the lucrative cement business is seen to complement the conglomerate’s big-ticket infrastructure ventures and enable it to diversify its business currently consisting of power generation, real estate, banking and agribusiness.
The merger of global companies Lafarge and Holcim provided the opportunity for AEV and CRH to acquire the cement assets of Lafarge as the two global companies had to dispose off their assets to win regulatory approval for the merger.