Lafarge sells Honduras unit to Colombia's Argos

Reuters, Tuesday 3 Sep 2013

French company has been selling non-core assets after racking up debt to buy Egypt's Orascom in 2008 to led to 'junk' ratings from Moody's and S&P

France's Lafarge said it has agreed to sell its cement business in Honduras to Cementos Argos for 232 million euros ($306 million) as part of its efforts to cut debt.

The transaction is based on an enterprise value for the unit of 435 million euros, or 8.6 times 2012 earnings before interest, tax, depreciation and amortization, the company said on Tuesday. Lafarge holds a 53.3 percent stake.

The Honduras unit includes an integrated cement plant with a capacity of 1 million tonnes and a grinding station with a 300,000-tonne capacity, Lafarge said in a statement.

The company has been shedding non-core assets after racking up debt to buy Egypt's Orascom in 2008, which led to "junk" ratings from agencies Moody's and Standard & Poor's.

Lafarge agreed earlier this year to sell its North American gypsum business for $700 million as it seeks to regain its investment grade, and said it aimed to shrink debt below 10 billion euros this year from 11.88 billion at end-June.

Including these last two deals, Lafarge has secured 1.75 billion euros in asset sales since January 2012, a company spokeswoman said.

Shares in Lafarge, which have lost some 4 percent since the beginning of the year, were down 0.4 percent at 46.225 euros at 0816 GMT.

Argos, Colombia's biggest cement maker, is controlled by Grupo Argos, a holding of companies that is part of the country's largest industrial conglomerate, the Grupo Empresarial Antioqueno, or GEA.

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