Cement Maker, Holcim Sells Lafarge for $1 Billion, Exits Nigeria Due to Intense Local Competition
Holcim has signed an agreement with Huaxin Cement Ltd to sell its entire 83.81 percent shareholding in Lafarge Africa PLC, valued at $1 billion on a 100 percent basis
After approximately 65 years of operations in Nigeria, Swiss cement and building materials manufacturer Holcim announced its decision to exit the country. The company revealed in a brief statement that it will sell its nearly 84 percent stake in Lafarge Africa to China’s Huaxin Cement for a deal valued at $1 billion.
In recent years, Nigeria has developed significant local manufacturing capacity in the cement industry, primarily led by market leaders such as the Dangote Group and BUA Cement. As a result, Holcim’s decision reflects the growing competition in the local market.
The transaction is expected to close in 2025, pending regulatory approvals from Nigerian authorities, as stated by the global building materials company.
This agreement is in line with Holcim’s strategy to streamline its portfolio and focus on high-growth regions, including the anticipated spin-off of its North American business, which is likely to occur in the first half of 2025.
Lafarge Africa Plc, formerly known as West African Portland Cement Company (WAPCO), began operations in Nigeria in 1959 as a joint venture among the Western regional government, Blue Circle, and the United Africa Company of Nigeria.
The company’s first kiln was commissioned on December 3, 1960, at the Ewekoro factory in Ogun State, and it was subsequently listed on the Nigerian Stock Exchange (NSE) in 1979. Lafarge Africa has been a leading building materials company in Sub-Saharan Africa and operates as a subsidiary of Holcim, a global leader in the building materials sector.
In Nigeria, it has been reported that Lafarge Africa operates several facilities. One of these is the Mfamosing plant located in Cross River State, which was originally established in 2002 as the United Cement Company Nigeria (UNICEM) Limited. As of now, this plant has an annual production capacity of 5 million tons.
There is also the Ashaka Cement plant, situated in the northeastern region of Nigeria. This plant was incorporated in August 1974 and began production in 1979, boasting an annual production capacity of approximately 1 million metric tons, according to some estimates. Additionally, Lafarge established a new mortar plant at its Sagamu factory in 2019.
Holcim, the parent company of Lafarge, is now focusing on sustainable growth in its core markets, higher-margin products, and strategic infrastructure investments. The company is actively seeking to enhance its environmental credentials. In September, Holcim took a stake in Sublime Systems, a U.S. tech start-up dedicated to developing low-carbon cement.
In October, Holcim reported a recurring operating profit of 1.67 billion Swiss francs (about $1.90 billion) for the third quarter, which was slightly better than expected. Notably, the sale of its 83.8 percent stake in Lafarge Africa plc implies an equity value of $1 billion on a 100 percent basis, as stated by the Switzerland-based company.
Holcim, which produces roofing and other housing products, aims to capitalize on the rising demand in the housing market, driven by a shortage of single-family homes and regulatory pressures for more energy-efficient buildings. The planned sale in Nigeria follows Holcim’s disposal of a majority stake in its Zambian operations to Huaxin Cement in 2021.
“Holcim has signed an agreement with Huaxin Cement Ltd to sell its entire 83.81 percent shareholding in Lafarge Africa PLC, valued at $1 billion on a 100 percent basis. The transaction is expected to close in 2025, subject to customary and regulatory approvals,” according to a brief statement made available to the media.
Holcim is a global leader in innovative and sustainable building solutions, reporting net sales of CHF 27.0 billion in 2023 and employing approximately 63,448 people worldwide. In Nigeria, Lafarge Africa has recently accelerated its efforts toward green growth, aiming to become a leader in innovative and sustainable building solutions. The company is at the forefront of decarbonizing construction throughout its lifecycle, aligning with Holcim’s purpose of “Building Progress for People and the Planet,” as stated on its website.
Lafarge Africa operates four plants in Nigeria, located in Sagamu and Ewekoro (Ogun State) in the southwest, Ashaka (Gombe State) in the northeast, and Mfamosing (Cross River State) in the south-south. The company currently has an installed cement production capacity of about 10.5 million tons per year.
In addition to its cement operations in Sagamu and Ewekoro, which have a combined production capacity of 4.5 million metric tons per annum (MTPA), Lafarge Africa also operates geocycle and mortar plants in the southwest. Its product portfolio includes five brands: Elephant Cement, Supaset, Powermax, Etex, and SRC, a sulphate-resistant cement designed for coastal construction. Its mortar products include TectorPlast, which is used for floor screed, floor tiling, wall screed, and wall tiling, among other applications.
On the other hand, Huaxin, the new investor, has a history spanning 116 years and has established itself as a leading company in China, as well as in the global cement industry. For over two decades, Huaxin Cement has maintained an average annual compound growth rate of 25 percent, securing its position as one of the top 10 manufacturing companies in China. The company operates over 300 branches and subsidiaries both within China and internationally, working across multiple sectors, including cement, concrete, and environmental protection. Read More
