LAST week Fossil Mines (Pvt) Limited – which is owned by local businessman Obey Chimuka – concluded a deal to take over Lafarge Cement Zimbabwe after being selected ahead of several bidders who wanted the cement giant. Swiss multinational Holcim Group had invited interested bidders to buy its 76.45% in Lafarge through its financial advisors, ABSA Corporate and Investment Banking of South Africa, and Fossil emerged as the winner. Lafarge Transaction Details:
• The disposal of Holcim’s Zimbabwean shareholding follows prior disposals of Holcim shareholding in the Northern Ireland, Zambian and Malawian markets. The Holcim Group is also in the process of disposing its Indian cement business;
• Holcim Group announced on 25 January 2022 of their intention to dispose of their 76.45% shareholding in Lafarge Cement Zimbabwe as part of their strategy to divest from the cement manufacturing business;
• Holcim invited interested bidders to submit their expressions of interest to its Financial Advisors, ABSA Corporate and Investment Banking in South Africa;
• After evaluation of the expressions of interest on 1 March 2022 Holcim then invited suitable investors to submit binding offers of interest for the acquisition. Fossil Mines (Private) Limited was amongst five invited businesses for the acquisition via an auction system;
• Fossil’s offer is backed by support from local banks, pension funds and wealth managers. Fossil engaged local Financial Advisors, and Commercial Attorneys to act on its behalf on the bid as well as Cliff, Decker and Hofmeyer of South Africa to act as its Transaction Advisory Team;
• As part of evaluating the bids Holcim invited the bidders to South Africa for negotiations;
• The final round of negotiations between Holcim and Fossil took place in South Africa from 28 May 2022 to 30 May 2022 wherein Fossil’s offer to acquire 76.45% of Lafarge Zimbabwe was accepted pending further due diligence of the asset (Lafarge) and regulatory approvals; and
• Should Fossil takeover Lafarge, the planned strategy is to maintain Lafarge as a Listed business and also recapitalize Lafarge leading to an increase in the cement output from the plant. Currently, 40% of Zimbabwe’s cement requirements are imported, an opportunity that Fossil wants to capitalise on by providing the market with readily available cement. – NewsHawks
