world's largest cement manufacturers, recently announced that it would spin off 100% of its North American business and list its assets in New York, which could be valued at $30 billion.
Holcim also announced that Miljan Gutovic, head of its European operations, would take over as group chief executive from May. Outgoing CEO Jan Jenisch will remain chairman and lead the planned spin-off. "We are too successful in North America and we are too big to manage it as a subsidiary,
" Jenisch told the Financial Times. "We have all the tools, all the supply chains, but we need more centralized management." Holcim was formed almost a decade ago by the merger of Lafarge of France and Holcim of Switzerland. But the merger was complicated by competing senior leadership and a scandal over payments made by Lafarge to terrorist groups in Syria after the deal was completed.
Holcim Europe wants to list in the US for higher valuations, greater market liquidity and analyst attention. CRH, one of the world's largest building materials groups, moved its main listing from London to New York last year. Its shares are up nearly 50% over the past year, and CRH is now valued at about $49.8 billion.
Holcim has a market cap of about $43.1 billion. The North American business, which accounted for only about 40% of sales last year, could be valued at $30 billion, Jenisch said. The North American business
is estimated to generate about $11 billion in net sales by 2023. The goal is to increase sales to more than $20 billion by the end of the century, relying on the U.S. construction and manufacturing boom, thanks to infrastructure investment triggered by Biden administration policies.
Holcim has about 850 sites and 16000 employees in the US and Canada, and has built its North American operations through acquisitions. It agreed to buy Firestone Building Products from Japan's Bridgestone for $3.4 billion in 2021.
Jenisch told the Financial Times that Holcim had "a portfolio of acquisitions" in the US. Owning US stocks to fund acquisitions would further help North American deals, he said. Building materials makers such as Holcim have fallen out of favor with more climate-conscious investors
because of the carbon footprint of products such as cement and concrete. In recent years, Holcim has sought to shift its business towards green building and emphasise its role in "decarbonising buildings". After
the demerger, Holcim will continue to be listed in Switzerland, with operations in Europe, Asia, the Middle East, Africa and Latin America.
