Lafarge Africa Plc has reached an agreement to sell the 100 percent equity interest held by the Company in Lafarge South Africa Holdings (Pty) Limited (LSAH) to Caricement B.V. (“Caricement”), an indirect subsidiary of LafargeHolcim Limited for $316 million.
This will lead to the total repayment of the Inter-Group Loans owed to LafargeHolcim by Lafarge Africa.
“Following the conclusion of the Proposed Sale, Lafarge Africa’s shareholder loan of US$293,000,000.00 as at July 31, 2019 (“Shareholder Loan‟‟), which represents the only existing foreign currency loan in the books of the Company will be completely extinguished,” Lafarge Africa said in a statement released to the Nigerian Stock Exchange (NSE).
The Transaction is subject to the NSE Related Party Rules. The completion of the transaction is expected to:
Boost Lafarge Africa’s cash flow and net income, given the reduction in debt service outflows; cut annual interest expense by N9.1 billion on account of the full repayment of the foreign currency inter-company loan; enable Lafarge Africa to reinvest in (and expand) operations in existing plants; enable the management of Lafarge Africa to devote attention to Lafarge Africa’s operations with higher profitability and prospects; strengthen Lafarge Africa’s Balance Sheet and position the Company to improve overall profitability; and enable the re-rating of the Company’s share price.
Lafarge Africa will present the terms of the Transaction to the shareholders for consideration at the 60th Annual General Meeting of the Company, as Special Business, which will be voted on by way of an ordinary resolution in accordance with the companies and allied matters act or CAMA.
Details later…
BALA AUGIE
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