CONGLOMERATE Aboitiz Equity Ventures Inc. (AEV) has committed to invest about P24 billion to enter the cement manufacturing business as it firmed up its partnership with UK-listed CRH plc to acquire a majority stake in the Philippine cement operations of Lafarge S.A.
In a disclosure to the Philippine Stock Exchange on Wednesday, AEV said it had formalized its investment agreements with CRH for the purpose of acquiring various Philippine assets and businesses of Lafarge, including the cement production and other cement related businesses and services.
AEV’s share in this transaction is estimated at P24 billion, the disclosure said.
“Full implementation and completion of the transaction is expected to be completed within the second half of 2015, subject to the conditions under the merger of Holcim and Lafarge and the approval of the global sale of Lafarge assets,” the disclosure said.
It was earlier disclosed that AEV-CRH intended to acquire majority of the shares of Lafarge Republic Inc. and the shares in Luzon Continental Land Corporation and Lafarge Cement Services Philippines Inc. These entities constitute majority of Lafarge’s Philippine cement operations.
CRH is a global leader in the manufacture and supply of a diverse range of building materials and products for the modern built environment. With operations in 34 countries worldwide, CRH is the largest building materials company in North America, a regional leader in Europe and has strategic positions in Asia. Its shares are listed on the London and Dublin stock exchanges as well as on the New York Stock Exchange in the form of American depository shares.
For its part, AEV is getting into infrastructure as the fifth leg of its core businesses after power, banking, food and property development.
The opportunity to acquire these cement assets arose following a merger between global cement giants Lafarge S.A. and Holcim Ltd.