The world’s largest cement manufacturer, LafargeHolcim Ltd, announced on Monday that it will sell its shareholding in Lafarge India to Nirma Ltd for a market value of $1.4 billion (approximately Rs 94,000 crore). “LafargeHolcim announces it has entered into a letter agreement with Nirma Ltd...for the divestment of its interest in Lafarge India for an enterprise value of approximately $1.4 billion,” the firm said in a statement.
This deal, which now needs the approval of the Competition Commission of India before it is final, is part of the company’s efforts towards its divestment plan for 2016 worth 3.5 billion Swiss franc. “The proceeds from the divestment will be used to reduce debt further,” LafargeHolcim said in the statement.
After the sale of its stake in Lafarge India, LafargeHolcim will continue its operations in the country through its subsidiaries, ACC and Ambuja Cements. The two firms combined have the capacity to produce more than 60 million tonnes of cement per year, and also have a countrywide distribution network. LafargeHolcim has already sold its business in South Korea, in addition to signing a deal on divesting its minority stake in Saudi Arabia, in line with its divestment programme.
Lafarge India is one of the country’s top manufacturers of ready-mix cement. It operates three cement plants and two grinding stations in the country, which give it a capacity of around 11 million tonnes a year.