Old Castle Group (CRH), an Irish cement maker, is considering buying assets owned by rivals Lafarge and Holcim that would have to be sold to win regulatory approval, two people familiar with the matter told Reuters.
Four consortia of private equity firms have also set their sights on the entire investment, valuing the assets at between $6.5 billion and $9 billion ( €5 billion to €7 billion).
Blackstone, Cinven and CPP, the Canadian pension fund, will jointly bid for the assets, while Advent and BC Partners will form a separate consortium, three people familiar with the matter said.
CVC has joined forces with three other limited partners to form a consortium, while Bain, Onex and another limited partner have formed a fourth consortium, two insiders said.
An Old Castle spokeswoman said the company would not comment on market rumors.
A Holcim spokesperson said: "As a general rule, we don't comment on sales processes as these discussions are governed by law.". As we announced, discussions with potential buyers began in August of this year.
Blackstone, Advent, BC Partners, Bain and CVC declined to comment. Sheng Feng, CPP and Onex could not immediately be reached.
The merger of Lafarge-Holcim, announced in April, will create the world's largest cement group with annual sales of $44 billion, the largest ever merger in the industry.
The move will help the two groups slash costs and debt and better cope with rising energy prices and sluggish demand since the 2008 economic crisis.
But competition authorities in about 15 countries, as well as the European Commission, are expected to take a hard look at the deal between two companies with a combined market value of more than $55 billion.
The two companies are seeking buyers for some of their assets, including Holcim's operations in France and Lafarge's operations in Germany, Austria, Hungary, Romania, Serbia, the United Kingdom, Canada, the Philippines, Mauritius and Brazil. The sale will affect about 10000 employees and about 3.5 billion euros of sales for the two companies.
Bernard Fontana, Holcim's chief executive, told reporters that the company had received more than 100 offers from rivals and private equity firms, several of which expressed a desire to buy all of the assets on sale.
Lafarge and Holcim said they hoped to formally request EU approval for the merger by the end of September, with the aim of closing the deal in the first half of 2015.
A Lafarge spokeswoman declined to comment on the status of the process, reiterating that Lafarge has received numerous offers for assets available for sale.
The Old Castle Group is embarking on the disposal plan of its new chief executive, Albert Manifold, and plans to sell at least 10%, or 1.5 billion to 2 billion euros, of its net assets.
Maniford said the sale of large cement businesses by Holcim and Lafarge would not overlap with the divestment of smaller product assets by Old Castle in Europe.
The Old Castle Group has adopted a small bolt-on acquisition strategy in recent years, spending 130 million euros on acquisitions in the first half of this year and having about 1.5 billion euros in funds for future transactions, Maniford said in May.
On the August conference call about the assets that Lafarge and Holcim must sell, Maniford said, "Like everyone else, if we see value, we will enter the process of acquisition."
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