Holcim Ltd · SIX:HOLN
Holcim — Merger or Acquisition (May 2015)
29 slides from Holcim's merger presentation, May 29, 2015
Slide 1: LafargeHolcim
LafargeHolcim May 2015 CREATING THE MOST ADVANCED GROUP IN THE BUILDING MATERIALS INDUSTRY
Slide 2: Disclaimer
Disclaimer Not for distribution in the United States, Canada, Australia or Japan Important information This communication does not constitute an offer to purchase or exchange or the solicitation of an offer to sell or exchange any securities of Lafarge or an offer to sell or exchange or the solicita
Slide 3: Creating the most advanced group in the building materials industry
CREATING THE MOST ADVANCED GROUP IN 1 THE BUILDING MATERIALS INDUSTRY THE BEST PLATFORM IN THE INDUSTRY TO 2 CAPTURE GROWTH 3 A UNIQUE VALUE CREATION PROPOSITION 4 NEXT STEPS & CONCLUDING REMARKS 3
Slide 4: Vision of LafargeHolcim
VISION OF LafargeHolcim CREATING THE MOST ADVANCED GROUP IN THE BUILDING MATERIALS INDUSTRY CREATING THE BEST GROWTH POSITIONING OUR BUSINESS PLATFORM IN THE INDUSTRY TO MEET CHANGING MARKET NEEDS » Driving growth across a global and » Enhancing the value proposition balanced footprint to meet chang
Slide 5: Key objectives at announcement are confirmed
KEY OBJECTIVES AT ANNOUNCEMENT ARE CONFIRMED » All competition approvals necessary for closing of the merger ALL received (17 jurisdictions including from the European Commission) WORKSTREAMS EXECUTION ON TRACK » Remaining antitrust clearance reviews (Mauritius and Indonesia) in progress, with no su
Slide 6: Key transaction highlights
KEY TRANSACTION HIGHLIGHTS COMPANY » LafargeHolcim NAME » Merger of equals DEAL » Spirit of the combination unchanged STRUCTURE » Company domiciled in Switzerland » Share listing on SIX Swiss Exchange (Zurich) and Euronext (Paris) » Exchange ratio of 9 Holcim shares for 10 Lafarge shares DEAL TERMS
Slide 7: Balanced governance
BALANCED GOVERNANCE PRO FORMA SHAREHOLDING NEW GOVERNANCE AND LEADERSHIP STRUCTURE » 7 members from Holcim and 7 from Lafarge BOARD OF » Wolfgang Reitzle and Bruno Lafont to DIRECTORS act as Co-Chairmen; Beat Hess as Vice-Chairman » CEO: Eric Olsen » CFO: Thomas Aebischer OTHER LAFARGE » Integration
Slide 8: Strong value creation for shareholders
STRONG VALUE CREATION FOR SHAREHOLDERS BEST-IN-CLASS GLOBAL PORTFOLIO, REBALANCED THROUGH DIVESTITURE » Balanced portfolio exposure » Benefiting from long term growth potential of emerging countries as well as cyclical recovery in developed economies BEST GROWTH PLATFORM AND SUPERIOR OPERATING PROFI
Slide 9: A combination of two successful groups
A COMBINATION OF TWO SUCCESSFUL GROUPS 2014 PRO FORMA FINANCIALS (unaudited, post divestitures and merger related adjustments)1 Annual Installed Cement Production 386 Capacity (mtpa) RUN-RATE EBITDA » Attractive margins, Net Sales CHF 32.6 / EUR 26.8 SYNERGIES2 (CHF / EUR bn) ~24% post synergies Ope
Slide 10: The best platform in the industry to capture growth
CREATING THE MOST ADVANCED GROUP IN 1 THE BUILDING MATERIALS INDUSTRY THE BEST PLATFORM IN THE INDUSTRY TO 2 CAPTURE GROWTH 3 A UNIQUE VALUE CREATION PROPOSITION 4 NEXT STEPS & CONCLUDING REMARKS 10
Slide 11: Leveraging trends into opportunities
LEVERAGING TRENDS INTO OPPORTUNITIES » 1bn more people expected OPPORTUNITIES FROM in and around urban areas URBANIZATION by 2020 » Improve the quality of CUSTOMERS DEMANDING buildings and reduce the VALUE-ADDED SOLUTIONS total cost during the lifecycle » More energy-efficient RESOURCE SCARCITY / bu
Slide 12: The best global portfolio in the industry
THE BEST GLOBAL PORTFOLIO IN THE INDUSTRY Combined net sales and operating EBITDA by region CHF 8.1 / EUR 6.6 # of 90 (in bn) countries CHF 1.4 / EUR 1.2 Sales EuropeEBITDA CHF 5.6 / EUR 4.6 CHF 1.1 / CHF 10.0 / EUR 0.9 EUR 8.3 North America North America Sales CHF 1.8 / EUR 1.5 Sales EBITDA Asia Pa
Slide 13: Global, well-balanced footprint positioned for sustainable and profitable growth
GLOBAL, WELL-BALANCED FOOTPRINT POSITIONED FOR SUSTAINABLE AND PROFITABLE GROWTH PORTFOLIO BREAKDOWN » c.60% of 2014 pro forma sales (2014 NET SALES)1 EMERGING » 13 countries out of our top 20 c. 40% Developed MARKETS with strong infrastructure needs2 markets » 6% CAGR for construction outputs expec
Slide 14: Innovative and customer focused approach
INNOVATIVE AND CUSTOMER FOCUSED APPROACH MOST INNOVATIVE » World’s largest R&D PRODUCTS AND SOLUTIONS center for building OFFERING materials » Understanding of customers ADRESSING ALL along the value chain CUSTOMERS NEEDS » From small to industrial end- customers » Strong focus on brand STRONG BRAND
Slide 15: Best-in-class R&D and innovation
BEST-IN-CLASS R&D AND INNOVATION Worldwide leading platform with more than 1,000 dedicated people HOLDERBANK » Central Research Center MONTREAL based in Lyon BRATISLAVA DUNDEE LYON BEIJING ALGIERS VIENNA » Network of Regional CAIRO CHONGQING Development Labs MUMBAI SINGAPORE KUALA LUMPUR RIO DE JANE
Slide 16: Global expertise to achieve operational excellence
GLOBAL EXPERTISE TO ACHIEVE OPERATIONAL EXCELLENCE » Best-in-class professional teams OPERATIONAL EXCELLENCE » State-of-the-art assets and technologies » Cross benefit from each company’s best practices ABILITY TO DEVELOP » From cement and aggregates to ready-mix concrete THE ENTIRE » From products
Slide 17: Strong tradition of sustainable development, health and safety
STRONG TRADITION OF SUSTAINABLE DEVELOPMENT, HEALTH AND SAFETY Focus on efficient Capturing new Best practice Commitment to use of water, opportunities in CO2 reduction local communities energy and in waste and CSR policy resources management Eco-friendly plants Co-founders Dow Jones of the Cement S
Slide 18: A shared commitment to employees
A SHARED COMMITMENT TO EMPLOYEES BEST LOCAL TEAMS INTEGRATED GLOBALLY HIGHEST LEVEL OF GLOBAL EXPERTISE AND INNOVATION SKILLS COMMITTED TO HEALTH & SAFETY WORLD-CLASS LEARNING DEVELOPMENT 18
Slide 19: A unique value creation proposition
CREATING THE MOST ADVANCED GROUP IN 1 THE BUILDING MATERIALS INDUSTRY 2 THE BEST PLATFORM IN THE INDUSTRY TO CAPTURE GROWTH 3 A UNIQUE VALUE CREATION PROPOSITION 4 NEXT STEPS & CONCLUDING REMARKS 19
Slide 20: Positioned for sustainable and profitable growth
POSITIONED FOR SUSTAINABLE AND PROFITABLE GROWTH BEST-IN-CLASS PORTFOLIO: INNOVATION STRONG FIT LEVERAGE GROWTH, ON AN EXPANDED FOR SUCCESSFUL BEST PRACTICES DIVERSIFICATION SCALE INTEGRATION & BALANCE DELIVER ON SYNERGIES SUPERIOR REVENUE GROWTH ENHANCED CASH FLOW & SIGNIFICANT OPERATIONAL GENERATI
Slide 21: Pro-active portfolio optimization and disciplined capital allocation
PRO-ACTIVE PORTFOLIO OPTIMIZATION AND DISCIPLINED CAPITAL ALLOCATION BEST USE OF RESOURCES Pro-active » Disciplined and globally managed capital allocation process Portfolio Management » Selective investments and divestments based on compelling and Disciplined business cases Capital » Focus on incre
Slide 22: In depth review of synergies potential
IN DEPTH REVIEW OF SYNERGIES POTENTIAL MANAGEMENT TEAMS HAVE JOINTLY REFINED EXPECTED SYNERGIES SINCE APRIL 2014 JOINT INTEGRATION PLAN TO ACHIEVE SYNERGIES HAS BEEN DEVELOPED CHIEF INTEGRATION OFFICER WILL HAVE SPECIFIC RESPONSIBILITY FOR REALIZING SYNERGIES SPECIFIC FOCUS ON RETENTION OF CUSTOMERS
Slide 23: Operational synergies overview
OPERATIONAL SYNERGIES OVERVIEW OPERATIONAL OPTIMISATION / BEST PRACTICES » Network rationalization in overlapping countries (freight, transport, distribution and capacity flows) » Best practices in productivity, use of alternative fuels, energy consumption optimization (e.g., Holcim’s expertise in g
Slide 24: Operational, financing and cash-flow synergies
OPERATIONAL, FINANCING AND CASH-FLOW SYNERGIES OPERATIONAL (EBITDA LEVEL) FINANCING & CASH-FLOW EUR 100 m (CHF 120 m) » Operational optimisation / EUR 200 m (CHF 240 m) » Financing savings (from end of year 1) best practices Up to EUR 200 m (CHF 240 m) (after the 3rd year) » Procurement » Capital EU
Slide 25: EUR 1.4bn run-rate synergies
EUR 1.4 bn (CHF 1.7bn) RUN-RATE SYNERGIES PRE-TAX SYNERGIES – PHASED IN OVER 3 YEARS EUR 1.4 / CHF 1.7 EUR 1.4 / CHF 1.7 0.1/0.2 0.2/0.3 0.2/0.3 EUR 0.5 / CHF 0.7 0.2/0.2 0.1/0.1 0.1/0.2 0.1/0.2 EUR 0.0 / CHF 0.1 0.1/0.1 0.1/0.2 1.0/1.2 1.0/1.2 0.1/0.1 0.7/0.8 0.3/0.4 (0.5)/(0.6) (0.5)/(0.6) Year 1
Slide 26: Next steps & concluding remarks
CREATING THE MOST ADVANCED GROUP IN 1 THE BUILDING MATERIALS INDUSTRY THE BEST PLATFORM IN THE INDUSTRY TO 2 CAPTURE GROWTH 3 A UNIQUE VALUE CREATION PROPOSITION 4 NEXT STEPS & CONCLUDING REMARKS 26
Slide 27: Next steps to closing
NEXT STEPS TO CLOSING KEY DATES DESCRIPTION June 1, 2015 » Opening of the Exchange Offer July 3, 2015 » Closing of the Exchange Offer » Publication of the final results of the Exchange Offer and listing of the July 9, 2015 Existing Holcim Shares on Euronext Paris » Capital increase of Holcim and iss
Slide 28: Unique value proposition for shareholders
UNIQUE VALUE PROPOSITION FOR SHAREHOLDERS NEW BEST-IN-CLASS GLOBAL PORTFOLIO BEST GROWTH PLATFORM AND SUPERIOR OPERATING PROFITABILITY SIGNIFICANT SYNERGIES STRICT CAPITAL ALLOCATION DISCIPLINE STRONG CAPITAL STRUCTURE ATTRACTIVE RETURNS FOR SHAREHOLDERS 28
Slide 29: LafargeHolcim
LafargeHolcim CREATING THE MOST ADVANCED GROUP IN THE BUILDING MATERIALS INDUSTRY