Lafarge, Firestone deal to have no direct impact on LHBL business
LHBL has said this deal is great for the LafargeHolcim Group but has no direct impact in the business of LHBL in the present context
On 7 January this year, Switzerland-based cement manufacturer LafargeHolcim signed an agreement to acquire United States (US)-based commercial roofing and building envelope solutions firm Firestone Building Products (FSBP) in a transaction valued at $3.4 billion.
LafargeHolcim is also doing business in Bangladesh under the name LafargeHolcim Bangladesh Limited (LHBL). The company is listed with the Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE).
On 12 January, both bourses sent a query letter to the company regarding the agreement news.
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In response to the query, the company said LHBL is not in the roofing business yet. Although this acquisition is great for the LafargeHolcim Group, it has no direct impact on the business of LHBL in the present context, it added.
The share price of LHBL rose by 88% in the last two months at the DSE. But in the last two days, its share price fell by 12% to Tk60 each.
Firestone Building Products is a business unit of Bridgestone Americas and a part of the Tokyo-based Bridgestone Corporation.
With up to 60% of buildings' energy lost through roofs, FSBP plays an instrumental role in mitigating this process, with its technologies that include cool roofs, insulation and waterproofing systems. FSBP's green roofs also contribute to more sustainable urban environments.
Hence, the acquisition is in line with LafargeHolcim's transformation to become the global leader in innovative and sustainable building solutions.
Commenting on the deal, LafargeHolcim's Chief Executive Officer Jan Jenisch said: "I am excited to be entering the highly attractive roofing business. With Firestone Building Products, we are strengthening our biggest market – the US, while also building a global growth and innovation platform for the company."
"Today's milestone is a strategic leap on our journey to become the global leader in innovative and sustainable building solutions, to build a world that works for people and the planet. I have great respect for the high-calibre leadership and expertise of the team of Firestone Building Products and look forward to welcoming them into the LafargeHolcim family," she added.
Earlier on 10 January, LHBL announced on the DSE website that it has started the commercial operation of a new plant to produce clinker's raw material – limestone.
The company invested Tk40.10 crore from its own fund to set up the new plant with a capacity of producing 12 lakh tonnes of limestone at its existing factory premises in Sunamganj.
LHBL has posted a 31% surge in its operating profit in the July to September period of 2020.
During the period, the company's operating profit stood at Tk84.4 crore compared to Tk64.2 crore in the same period of 2019.
The company also witnessed a 3% increase in its net sales in the quarter on a year on year basis.
The outlay of its net sales stood at Tk365.5 crore in the July to September period of 2020 compared to Tk355.8 crore in the same period of 2019.
Despite uncertainties amid the Covid-19 pandemic, the company believes the strong record of growth and sound economic policies of Bangladesh will rebound its growth trajectory.
