Holcim makes recommended offer to the shareholders of Aggregate Industries plc, UK

01.20.2005
 

Holcim makes recommended offer to the shareholders of Aggregate Industries plc, UK. The Boards of Holcim and Aggregate Industries are pleased to announce that they have reached unanimous agreement on the terms of a recommended cash offer to be made by Holcim to acquire the entire ordinary share capital of Aggregate Industries.

Holcim is offering the ordinary shareholders of Aggregate Industries 138 pence per share. In addition, Aggregate Industries' shareholders will be entitled to a second interim dividend of 2 pence per share if the offer becomes or is declared unconditional in all respects. A loan note alternative will be made available. The offer, together with the proposed second interim dividend, values the entire issued ordinary share capital of Aggregate Industries at approximately £ 1.8 billion.

Holcim will finance this investment with existing cash balances and new committed credit facilities.

The offer price, together with the proposed second interim dividend, represents a premium of 22.8 percent over the closing price of 114.0 pence per share on 11 January 2005 and a premium of 42.2 percent over the average closing share price over the three months ending 11 January 2005 of 98.5 pence per share.

Through purchases in the market, Holcim currently owns 190 million Aggregate Industries shares representing 14.7 percent of the issued ordinary share capital of Aggregate Industries. Holcim has also received irrevocable undertakings to accept the offer from each of the Aggregate Industries directors that hold Aggregate Industries shares in respect of 6,485,796 Aggregate Industries shares, or 0.5 percent of the issued ordinary share capital of Aggregate Industries. These undertakings will remain binding in the event of a competing offer being made for Aggregate Industries and will cease to be binding only if the offer lapses or is withdrawn.

The directors of Aggregate Industries, who have been so advised by Greenhill & Co. International LLP, consider the terms of the offer to be fair and reasonable and intend to unanimously recommend the offer to Aggregate Industries' shareholders. In providing its advice, Greenhill & Co. International LLP has taken into account the commercial assessments of the Aggregate Industries directors.

Holcim is delighted that Aggregate Industries' Chief Executive, Peter Tom, intends to remain as Chief Executive of the Aggregate Industries Group and play a key role in the integration and the leveraging of the assets and skill base of the enlarged Holcim Group.

Holcim's long-term strategy has been to focus on its core businesses of cement, aggregates and ready-mix concrete. In selected developed and emerging markets, Holcim's strategy is to strengthen its business activities to build on its position as an integrated provider of building materials. Aggregate Industries is a major, integrated supplier of aggregates, asphalt and ready-mix concrete in the UK and the United States.

The strategic benefits of strengthening the existing aggregates and ready-mix concrete businesses of Holcim include:
Adding 5.1 billion tonnes of aggregates reserves (based on 2003 figures) which are well located and strategically important with an average life exceeding 70 years. With 7.0 million cubic metres of annual ready-mix concrete production (based on 2003 figures), Aggregate Industries also brings new sales channels to the combined group. The acquisition will achieve the addition of aggregates and ready-mix concrete businesses in a number of key market regions served by Holcim in the United States. Holcim will gain entry into the UK, an attractive market for building materials, via the established market presence of Aggregate Industries. The reinforcement of the specific management expertise in the aggregates, asphalt and ready-mix concrete segments and the exploitation of combined best practice throughout the enlarged Holcim Group. Holcim believes that the transaction will be immediately accretive to Holcim's free cashflow and cash earnings per share and should generate annual synergies of approximately CHF 100 million by 2007. Statement by Holcim CEO Markus Akermann: "The combination with Aggregate Industries strengthens the position of Holcim as an integrated supplier of building materials. Aggregate Industries brings high quality aggregates and downstream businesses giving important value benefits for Holcim in the United States. Entry into the attractive UK market is part of our strategy of being present in all key markets.

I am delighted that the experienced management team under the leadership of the Chief Executive, Peter Tom, intends to remain and play a key role in further strengthening the aggregates business of the enlarged group in the future. I am convinced that this offer is a source of added value for the shareholders of Holcim."

Statement by Peter Tom, Chief Executive of Aggregate Industries:"This offer delivers significant value for our shareholders, enabling them to realise an attractive premium in cash. It creates the opportunity to further develop the combined aggregates business backed by the resources of the enlarged Holcim Group."

This media release should be read in conjunction with the full text of the offer announcement (see www.holcim.com). Additionally, Holcim announces in a separate media release, entry into the growth market of India.


Citigroup Global Markets Limited, which is regulated by the Financial Services Authority in the United Kingdom, is acting as financial adviser to Holcim and the offeror and no one else in connection with the offer and will not be responsible to anyone other than Holcim and the offeror for providing the protections afforded to clients of Citigroup Global Markets Limited, nor for providing advice in relation to the offer. Greenhill & Co. International LLP, which is regulated by the Financial Services Authority in the United Kingdom, is acting as financial adviser to Aggregate Industries and no one else in connection with the offer and will not be responsible to anyone other than Aggregate Industries for providing the protections afforded to clients of Greenhill & Co. International LLP, nor for providing advice in relation to the offer.

 
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