Anglo American has reached an agreement in principle for the sale of its 50% ownership interest in Lafarge Tarmac Holdings to Lafarge SA for a minimum value of US $1.5 billion in cash, on a debt and cash free basis and subject to other customary working capital adjustments.
An announcement is being made at this stage as Lafarge intends to offer a full divestment of the JV to the European Commission as a remedy for the UK market in respect of the proposed merger of Lafarge and Holcim. Under the terms of the in principle agreement, which is not legally binding, the sale will be subject to a number of conditions including the completion of the Lafarge /Holcim merger, the divestment of Lafarge Tarmac being accepted as a suitable remedy and approval of this sale transaction by the necessary regulators. Lafarge and Holcim have announced that they expect the merger to be completed in the first half of 2015. Anglo American and Lafarge will work towards finalising the terms of a definitive agreement in Q3 2014.
In the event that a subsequent divestment of Lafarge Tarmac is agreed within 18 months of this sale being completed, then Anglo American will participate in a minority proportion of the upside beyond a small premium to the terms of this proposed transaction.
Anglo American expects to use the proceeds to pay down debt.
Anglo American to sell Lafarge Tarmac to Lafarge for $1.5bn
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