Lafarge sells Ecuador operations

Lafarge announced the sale of its cement operations in Ecuador for an enterprise value of US$553m to Union Andina de Cementos SAA (UNACEM).

Lafarge Cementos SA operates an integrated cement plant of 1.4Mt of capacity, located in Otavalo, in the North of the country.
 
This divestment will contribute to Lafarge's objective to reduce net debt below EUR9bn in 2014, the group said.

Ecuador was one of the countries where the proposed ‘LafargeHolcim’ combination was expected to see considerable overlap. Holcim is the country's leading cement producer with over 60 per cent of market share while Lafarge has around 22 per cent. "So, aside from being a good fit in terms of complying with the net debt reduction target, this could also be an initial step to deal with market concentration issues relating to the planned merger," according to Morgan Stanley commentary on Lafarge's exit from the market.