Construction BUSINESS

Holcim, a prominent Swiss building materials giant, is set to spin off its North American operations in a strategic move valued at around $30 billion. This significant divestment, the most substantial since Holcim’s 2015 acquisition of Lafarge, aims to list the new entity independently on the New York Stock Exchange by the first half of 2025. Miljan Gutovic, currently overseeing European operations, will take over as the new CEO, succeeding Jan Jenisch. The strategic decision aligns with industry trends, mirroring the move of CRH, an Irish-based building products maker, which shifted its primary stock market listing to New York last year.

The spin-off is expected to propel Holcim’s US business’s annual sales from $11 billion to over $20 billion, targeting an operating profit surpassing $5 billion by 2030. The remaining global operations of Holcim, spanning Europe, Latin America, Africa, and Asia, will continue to be listed on the Swiss stock exchange, with a focus primarily on materials such as roofing products. Jan Jenisch, who has been at the helm since 2017, will retain his position as chairman and spearhead the planned listing in the US. Emphasizing the attractiveness of the US construction market, he envisions the new company capitalizing on the ongoing infrastructure and construction boom in the region.

Holcim currently holds the position of the largest cement maker in North America, with 16,000 employees across 850 sites. The divested US operations, constituting a fifth of Holcim’s sales in the first nine months of 2023, have been the company’s most profitable region, experiencing sales growth exceeding 20% on average in recent years. Describing the US operations as “simply too successful to be run as a subsidiary,” Jenisch’s vision reflects Holcim’s strategic commitment to maximizing opportunities in the thriving North American construction market while maintaining a robust global presence outside North America.

Source: Irish Examiner