Afrimat has notified its shareholders that the Competition Tribunal has granted approval for the Lafarge South Africa (Holcim) acquisition. All other regulatory authority approvals have been granted.
In a Stock Exchange News Service announcement, the CEO of Afrimat, Andries van Heerden, indicated that this exciting deal forms part of the Afrimat Group's ongoing diversification strategy. “It will increase Afrimat’s offering in the construction materials space, by expanding the group's quarry and ready-mix operations nationally. Additionally, access to the fly ash operations provides a foothold into the cement extender market. The grinding plant will allow Afrimat to grind various materials as value-added products for our current and new customers, while the cement kilns allow the group to enter the cement value chain competitively.”
For this acquisition, Afrimat entered into a share purchase agreement with a Holcim Group subsidiary, Caricement B, in which Afrimat will acquire 100 per cent of the issued share capital of Lafarge South Africa Holdings Proprietary Ltd. The acquisition has been structured as a locked box transaction, effective 31 December 2022, and the purchase consideration payable is in the amount of US$6m. In addition to this, Afrimat agreed to repay or procure the repayment of the loan amounts owed equating to ZAR900m (US$48m).
The Lafarge acquisition will be integrated into the Construction Materials segment of Afrimat, with van Heerden adding that, “the time is perfect for Afrimat to return to its roots of quarrying and aggregates to support long-term diversified sustainability across the group.”
The acquisition includes the 2.4Mta Lichtenburg and 1Mta Randfontein cement plants in South Africa, as well as the closed Richards Bay grinding plant.
