2024-01-29 06:05:57
Swiss group Holcim will sell 100% of its North American operations in an IPO in New York that could value the company at $30 billion, the building materials giant said on Sunday, which also appointed a new general manager.
Miljan Gutovic, currently head of Europe at Holcim, will replace Jan Jenisch as CEO from May 1, the company, one of the world’s largest cement makers, said.
It is the biggest shakeup at Holcim since the Swiss company bought French rival Lafarge in 2015, and the sale will likely be completed in the first half of 2025.
The split could value the new company at around $30 billion, Mr. Jenisch told reporters, with Holcim retaining no stake.
“We will carry out a complete separation of our North American activities in the capital market, so that 100% of the activities will be listed on the New York Stock Exchange,” said Mr. Jenisch, who said he was convinced of ‘obtain shareholder support for the IPO.
The US company aims to grow its annual revenue from around $11 billion currently to more than $20 billion and generate operating profit of more than $5 billion by 2030, the company said.
The rest of Holcim’s global operations – in Europe, Latin America, Africa and Asia – will remain listed on the Swiss SMI index and will focus on construction solutions such as roofing products.
Jenisch, who has led Holcim since 2017, will remain chairman and lead the planned listing in the United States, where building materials companies trade at higher earnings multiples than in Europe, which could improve its valuation.
Describing the United States as one of the most attractive construction markets in the world, Mr Jenisch said the move would help the new company take advantage of the region’s infrastructure and construction boom.
Holcim is the largest cement manufacturer in North America, where it employs 16,000 people at 850 sites. In the region, the company competes with companies such as Carlisle and RPM in the construction products and solutions space, and Eagle Materials and Summit Materials in the cement industry.
The US operations accounted for a quarter of Holcim’s sales in the first nine months of 2023, and was also the company’s most profitable region, with average sales growth of more than 20% over the past few years. Holcim’s remaining businesses will generate sales of around 17 billion Swiss francs and employ 48,000 people.
The U.S. business was “simply too successful to be run as a subsidiary,” Mr. Jenisch said. (Reporting by John Revill, Editing by Bernadette Baum)
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