Lafarge to Buy Orascom Cement for EU8.8 Billion

Lafarge SA, the world's biggest cement maker, said it will buy the cement unit of Orascom Construction Industries for 8.8 billion euros ($12.9 billion).

Lafarge will finance the purchase with 6 billion euros of debt and the sale of 22.5 million new shares, the Paris-based company said in an e-mailed statement. Orascom Chief Executive Officer Nassef Sawiris will buy the shares, taking an 11.4 percent stake in Lafarge, as part of the agreement.

Cement makers such as Lafarge are racing to expand globally, using acquisitions to grow in countries where spending on building as well as transport systems is accelerating. Lafarge said the purchase will allow it to garner 65 percent of its earnings before interest, tax, depreciation and amortization from emerging markets by 2010.

``Orascom Cement's positions are concentrated in a fast- growing region that will fully benefit from the boom in oil and natural gas revenues,'' Lafarge Chief Executive Officer Bruno Lafont wrote in the statement. The purchase will add to earnings per share from the first year, he said.

source:bloomberg.com