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Holcim is a Swiss-based global
building material
Building material is material used for construction. Many naturally occurring substances, such as clay, rock (geology), rocks, sand, wood, and even twigs and leaves, have been used to construct buildings. Apart from naturally occurring materia ...
s and
aggregates flagship division of the
Holcim Group
The Holcim Group, legally known as Holcim Limited, (formerly known as LafargeHolcim) is a Swiss multinational company that manufactures building materials. It has a presence in around 70 countries, and employs around 72,000 employees. Holcim op ...
. The original company was merged on 10 July 2015 with
Lafarge
La Farge, LaFarge or Lafarge can refer to:
People
* Antoinette LaFarge (1966–), American artist and writer
* Christopher Grant LaFarge (1862–1938), American architect and partner in the firm Heins & LaFarge
* Christopher Grant La Farge ( ...
to form LafargeHolcim as the new company and renamed to Holcim Group in 2021. When the merger was completed, the Holcim brand was retained within the group.
Founded in 1912, the company expanded into France and then throughout Europe and Middle East during the 1920s. They expanded in the Americas during the 1950s and went public in 1958. The company continued to expand in Latin America and added Asian divisions during the 1970s and 1980s. A series of mergers and buyouts made Holcim one of the two largest cement manufacturers worldwide by 2014, roughly tied with rival Lafarge. In April 2014, the two companies agreed to a US$60 billion "merger of equals". The company was the market leader in cement production in Australia, Azerbaijan, India, Slovakia, Switzerland, and Latin America.
Overview
Holcim is headquartered in
Zug
, neighboring_municipalities = Cham, Baar, Walchwil, Steinhausen, Unterägeri
, twintowns = Fürstenfeld (Austria), Kalesija (Bosnia-Herzegowina)
Zug (Standard German: , Alemannic German: ; french: Zoug it, Zugo r ...
, Switzerland and holds interests in more than 70 countries worldwide. They employ 71,000 people.
Subsidiaries include St. Lawrence Cement (Canada),
Aggregate Industries
Aggregate Industries, a member of the Holcim Group, is a company based in the United Kingdom with headquarters at Bardon Hill, Coalville, Leicestershire. Aggregate Industries manufactures and supplies a range of heavy building materials, prima ...
(the UK), and Holcim Apasco (Mexico). The company's products include cement, clinker, concrete, lime, aggregates, and roofing materials.
They also offer consulting services, third party research and development, and land waste management services.
Their largest business segment is the manufacture and distribution of cement and aggregates.
As of 2014, Holcim's annual production capacity was 215 million tons.
It has a BBB credit rating according to
Fitch Ratings
Fitch Ratings Inc. is an American credit rating agency and is one of the " Big Three credit rating agencies", the other two being Moody's and Standard & Poor's. It is one of the three nationally recognized statistical rating organizations ( NRSRO ...
, with a 3.5
funds from operations Funds from operations (FFO) is the term that investors use in order to describe the cash flow of a real estate company or a real estate investment trust
A real estate investment trust (REIT) is a company that owns, and in most cases operates, inco ...
to debt ratio.
Holcim is the cement market leader in Australia, Azerbaijan, India, Slovakia, Switzerland, and Latin America. It is among the top few producers throughout Europe, North America, and Asia. Globally, Holcim and
Lafarge
La Farge, LaFarge or Lafarge can refer to:
People
* Antoinette LaFarge (1966–), American artist and writer
* Christopher Grant LaFarge (1862–1938), American architect and partner in the firm Heins & LaFarge
* Christopher Grant La Farge ( ...
are the two largest producers in terms of sales, as of 2014.
History
Foundation and development
Holcim was founded by Adolf Gygi in 1912 as "Aargauische Portlandcementfabrik Holderbank-Wildegg".
The original headquarters were in
Holderbank, (
Lenzburg district
Lenzburg District is a district of the Canton of Aargau in Switzerland, lying at the center of the canton. The district capital is the town of Lenzburg. It has a population of (as of ).
Geography
The Lenzburg district has an area, , of . Of ...
, Canton of
Aargau
Aargau, more formally the Canton of Aargau (german: Kanton Aargau; rm, Chantun Argovia; french: Canton d'Argovie; it, Canton Argovia), is one of the 26 cantons forming the Swiss Confederation. It is composed of eleven districts and its capita ...
).
In 1914, the company merged with "Rheintalischen Cementfabrik Rüthi" owned by Ernst Schmidheiny. Schmidheiny took over leadership duties and began the company on a course of expansion.
In 1922, Holderbank, as the company was then known, expanded beyond the Swiss borders into France. Schmidheiny continued to expand, primarily by buying stakes in existing companies. By the end of the decade Holderbank held stakes in Belgium, Germany, the Netherlands, and Egypt.
Positions in Lebanon and South Africa soon followed.
Schmidheiny died in the 1930s and his sons, Ernst Jr. and
Max, took over the business, splitting it into two divisions. Ernst took over the Holderbank building materials business, while Max oversaw the other lines. This organization scheme remained in place until the 1970s.
After World War II, Hans Gygi, son of Adolf Gygi, took over leadership. He oversaw the company during the Swiss housing boom of the 1950s, and as Holderbank expanded into Canada, then throughout North and South America. The company went public in 1958 in order to raise more capital to fuel further expansion.
Hydroelectric
Hydroelectricity, or hydroelectric power, is electricity generated from hydropower (water power). Hydropower supplies one sixth of the world's electricity, almost 4500 TWh in 2020, which is more than all other renewable sources combined and ...
projects in Switzerland generated large concrete contracts, offsetting losses in Egypt when the country's government nationalized Holderbank's factories.
During the early 1970s, growth in Brazil and Mexico improved the company's bottom line. The Schmidheiny brothers convinced shareholders that the company should consolidate holdings and merge with Schweizerischen Cement-Industrie-Gesellschaft. The combined company had annual revenue of 800 million
Swiss franc
The Swiss franc is the currency and legal tender of Switzerland and Liechtenstein. It is also legal tender in the Italian exclave of Campione d'Italia which is surrounded by Swiss territory. The Swiss National Bank (SNB) issues banknotes and the f ...
s and established Holderbank as one of the industry's largest companies worldwide. The oil crisis of 1973 hit the industry hard as construction demand dried up in much of the world. Strong markets in Lebanon and South Africa allowed Holderbank to weather the storm. By 1976, revenue and profits had returned to pre-crisis levels.
In the late 1970s and early 1980s, Holderbank continued its expansion in Latin America and expanded into Asia and Spain for the first time.
Thomas Schmidheiny
Thomas Schmidheiny (born 17 December 1945) is a Swiss billionaire businessman, and the former chairman of cement manufacturer Holcim.
Early life
Thomas Schmidheiny was born in 1945, the son of Max Schmidheiny (1908-1991). The family's construc ...
took over leadership, overseeing the company as in expanded into Eastern Europe and experienced a boom in Spanish construction preceding the
1992 Summer Olympics
The 1992 Summer Olympics ( es, Juegos Olímpicos de Verano de 1992, ca, Jocs Olímpics d'estiu de 1992), officially known as the Games of the XXV Olympiad ( es, Juegos de la XXV Olimpiada, ca, Jocs de la XXV Olimpíada) and commonly known as ...
. By 1986, Holderbank was the world's largest cement manufacturer. In the 1990s, the company consolidated its European holdings as the American market drove growth. Expansion into Eastern Europe and Russia continued.
In 2001, the company changed its name from "Holderbank Financière Glaris" to Holcim (short for
Holderbank
ciment).
Asia drove growth in the 2000s, as the company saw more than 50% of its business come from emerging markets.
In 2005, Holcim purchased
Aggregate Industries
Aggregate Industries, a member of the Holcim Group, is a company based in the United Kingdom with headquarters at Bardon Hill, Coalville, Leicestershire. Aggregate Industries manufactures and supplies a range of heavy building materials, prima ...
for US$4.1 billion, entering the United Kingdom for the first time.
That year, the company also expanded into India by acquiring a stakes in The
Associated Cement Companies (ACC) and Ambuja Cement Eastern. In 2008, Holcim became the largest shareholder of China's Huaxin Cement with a 40% stake. In 2009, they acquired Cemex Australia.
In February 2012, Bernard Fontana became the first CEO of Holcim that was not part of the founding families.
Merger with Lafarge
On 7 April 2014, Holcim and Lafarge announced they had agreed to terms on a "merger of equals" valued at nearly $60 billion. The merger entails 10 Lafarge shares being converted into 9 Holcim shares. Holders of 86% of Lafarge shares accepted this offer in June 2015, according to Holcim, meaning that the merger would proceed.
The new company would be based in Switzerland and have a manufacturing capacity of 427 million tons a year, which would vastly exceed the 227 million ton capacity of current industry leader
Anhui Conch.
Lafarge
Chief Executive Officer
A chief executive officer (CEO), also known as a central executive officer (CEO), chief administrator officer (CAO) or just chief executive (CE), is one of a number of corporate executives charged with the management of an organization especially ...
Bruno Lafont will lead the new company, while Holcim's Wolfgang Reitzle will be chairman.
Executives from both companies said the deal will save the new company 1.4 billion euros (US$1.9 billion) annually and create "the most advanced group in the building materials industry."
Analysts said the deal could lead to further mergers within the industry and give competitors a chance to pick up assets at a bargain price.
Notes and references
{{Portal bar, Companies, Switzerland
Cement companies of Switzerland
Companies based in Zug
Manufacturing companies established in 1912
Swiss brands
Holcim Group
Swiss companies established in 1912
2015 mergers and acquisitions
Companies formerly listed on the SIX Swiss Exchange