Cracks in a Record Cement Merger

Are shareholders digging a big hole for themselves?
  • Why it matters

    Why it matters

    The merger would create the world’s largest building materials producer, but could collapse if Holcim shareholders aren’t offered more cash.

  • Facts


    • Holcim and Lafarge announced they would merge last April in a 1:1 share exchange.
    • The combined company will have joint sales of about €30 billion ($32.3 billion).
    • Holcim has been performing well since April and some shareholders now want a bigger slice of the pie.
  • Audio


  • Pdf

After a successful career on the BMW management board and as head of the Linde Group, an industrial gas producer, Wolfgang Reitzle was probably hoping for a quieter life when he took the role of chairman at the merged cement giant, LafargeHolcim.

But now Mr. Reitzle has found himself in the middle of a crisis management situation as the billion-euro merger of the two largest producers of building materials teeters dangerously on the edge.

A key shareholder of Switzerland-based Holcim, whose performance has perked up since the merger was announced last April, is protesting details of the deal. According to the Zurich-based newspaper Sonntagszeitung, Swiss industrialist Thomas Schmidheiny, Holcim’s majority shareholder with 20 percent, is demanding the deal be sweetened for Holcim owners.

A spokesperson for Mr. Schmidheiny didn’t deny the report, saying simply, “The industrial logic of the merger is undisputed.” Holcim responded with a cryptic message that the company “had taken note of the reactions of a certain Holcim stockholder.” Meanwhile, Lafarge made no comment.

Want to keep reading?

Subscribe now or log in to read our coverage of Europe’s leading economy.