Global launch for LafargeHolcim

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Europe: On 15 July 2015 LafargeHolcim officially launched the new group around the world and announced key elements of its ambitions for the future. Following the successful completion of the merger between Lafarge and Holcim and the listing of the new LafargeHolcim shares in Zurich and Paris, the new group will now work towards its target of creating the highest performing company in the building materials industry.

LafargeHolcim CEO Eric Olsen said, "Now as LafargeHolcim, we will step into the next phase of our transformation to become the leader in every respect – a company that has a positive impact on the world and can make a real difference for its customers, its employees, its shareholders and society."

The company is initiating a strategic transformation by building on the best of both Lafarge and Holcim. LafargeHolcim will now focus on five areas in its first integration phase:

• Synergies: Delivering on a Euro1.4bn synergy target within three years;

• Capital allocation: Adopting a rigorous approach to capital allocation and overall reduction of capital spending;

• Commercial transformation: Creating differentiation through innovative products and solutions;

• Integration: Creating one new group and culture;

• Health and safety: Putting health and safety at the centre of the organisation.

LafargeHolcim says that it will be organised along a new operating model oriented to serve its local customers, while leveraging the group's size, footprint, and capabilities at global scale. It added that this 'combines empowered countries, regional management platforms and expertise-driven group functions.'

The group added that it will present separate results for Lafarge and Holcim results for the first half of 2015. The first LafargeHolcim results will be presented for the first nine months of 2015.

In its official launch in Zurich, LafargeHolcim's CEO Eric Olsen said, with over 115,000 colleagues in 90 countries, LafargeHolcim was now the clear leader in the building materials sector. He highlighted that the company was present in 'all relevant markets' and was not looking for significant capital-intensive growth. Despite economic hardship in various markets, LafargeHolcim expects 'reduced volatility due to a very balanced global portfolio.'

Olsen said that LafargeHolcim would be able to 'thrive in a low-investment environment,' adding that the group would be 'very selective in persuit of growth.' When asked if there would be further divestments, Olsen stated that there were no plans to divest further assets at present, beyond the assets to be sold as part of the merger.

Olsen also acknowledged that there would be redundancies in some countries where Lafarge and Holcim were both previously present, giving the US as an example. No specific headcount changes were announced.

Olsen outlined a timeline of targets for LafargeHolcim. In the first 100 days the company will begin to enact its action plans for its five key areas. A strategic roadmap will be presented before the close of 2015. Within the first 300 days the new organisational structure will be in place and all transactions pertaining to the merger will be complete. At this stage the company will also be able to see 'tangible results' from its synergies plan.

Within 500 days Olsen said that the integration would be complete and LafargeHolcim would be operating 'beyond the integration phase.' By 1000 days the company expects to have achieved the whole of its Euro1.4bn synergy targets.

Last modified on 15 July 2015

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