Lafarge and Boral, partners in the Lafarge Boral Gypsum in Asia Limited joint venture, have signed a Memorandum of Understanding with Siam Cement C° Ltd to create a strategic partnership in the gypsum business in Thailand and for the joint ownership of Siam Gypsum Industry C° Ltd (SGI).
Lafarge Boral Gypsum in Asia will acquire a majority shareholding of 71 % in SGI, which will therefore become part of the Lafarge Boral joint venture.
SGI operates three plants with 80 million square metres of plasterboard capacity. SGI manufactures the well known "Elephant" brand gypsum products, is market leader in plasterboard in Thaïland, and exports throughout the ASEAN area. SGI will continue to benefit from access to Siam Cement's extensive building materials distribution network.
This new acquisition shows the ongoing commitment of Lafarge and Boral to the gypsum industry in Asia, with leading positions now established in South Korea, East China, Thaïland, Indonesia, Philippines, Malaysia, Singapore, Vietnam, Cambodia, Laos and Brunei. The joint venture now has 270 million square metres of plasterboard capacity.
Agreements establishing the strategic partnership are expected to be signed before the end of March 2001 with completion being planned for a month later.
The purchase of the 71% shareholding in SGI involves a cash payment of around US$ 50million at completion. SGI also has approximately US$ 35 million in debt. In their joint venture with Lafarge, Boral currently has a 27% interest and Lafarge a 73% interest. Boral has the right to increase its minority shareholding to 50% over the next two and half years, by disproportionately financing development projects. Therefore Boral will fund all the cash payment of this transaction with new equity in the joint venture. Its shareholding in the joint venture will rise to around 43% and Lafarge's shareholding will reduce to around 57%.
World leader in building materials, Lafarge (headquartered in Paris, France) holds top ranking positions in each of its four Divisions: Cement, Aggregates & Concrete, Roofing and Gypsum. The Gypsum Division of Lafarge has activities in 23 countries and with more than 3,600 employees, it had sales revenues in 2000 of 1 billion Euro.The Group employs 66,000 people in 70 countries. It generated sales of 12.2 billion Euro in 2000.
Boral (headquartered in Sydney, Australia) holds leading positions in each of the building and construction materials businesses it operates in Australia, Asia and the USA. It had global sales in 1999/2000 of A$4.0 billion (Euro 2.3 billion) and employs over 12,000 people.
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