A proposed $44.27 billion merger between Switzerland-based Holcim Ltd. and France's Lafarge SA, is moving forward again, after coming to a halt earlier this month over disagreements on some points in the original terms. The two companies have come to a new agreement over the stockholder share exchange ratio and exactly who will lead the combined operation.
According to a joint press release:
Both parties agreed on a new exchange ratio of 9 Holcim shares for 10 Lafarge shares. A new Chief Executive Officer for the combined group, to be proposed by the Lafarge Board and accepted by the Holcim Board, will be appointed as from the closing of the transaction. The appointment is expected to be communicated in due course, at the latest upon filing of the public offer to the Lafarge shareholders. Wolfgang Reitzle and Bruno Lafont will be nonexecutive
Co-Chairmen of the Board. The two Co-Chairmen will be working closely together to make this merger a success. Beat Hess will be Vice-Chairman of the Board ... Lafarge and Holcim have agreed that, subject to shareholder approval, the new company will announce a post-closing scrip dividend of 1 new LafargeHolcim share for each 20 existing shares.
Holcim shareholders had raised issues with both points (leadership and the share exchange ratio), spurred by the fact that since the deal was first announced last April, Holcim's stock has outperformed Lafarge. At that time, the plan was called a "merger of equals" by both companies.
Now that the overall merger is back on track, the two companies are closer to forming what could become the world's largest cement and construction company. New York Times writer David Jolly notes:
“Certain key shareholders of both companies have confirmed their support for the revised merger terms,” the companies said in the statement. “The parties expect the transaction to close in July 2015.”