Swiss building materials giant Holcim plans $30bn US spinoff

Holcim's plan comes after Irish-based building products maker CRH moved its main stock market listing to New York to tap the booming US market

Holcim's then chairman Rolf Soiron and Lafarge's then chief Bruno Lafont when the companies agreed to merge in 2014. 

Switzerland’s Holcim will spin off 100% of its North American operations in a New York flotation which could value the business at $30bn (€27.5bn), the building materials giant has said, as it also named a new CEO.

Miljan Gutovic, currently head of Europe at Holcim, will replace Jan Jenisch as CEO beginning on May 1, according to the company, one of the world’s biggest cement makers.

In the biggest shake-up at Holcim since the Swiss company took over French rival Lafarge in 2015, the divestment will likely be completed in the first half of 2025.

The spin-off could value the new company at around $30bn, Mr Jenisch told reporters, with Holcim retaining no stake.

The Holcim plans come as CRH, the Irish-based building products maker, moved its main stock market listing last year to New York to help it tap the booming market.

“We’re going to do a full capital market separation of our North American business, so we will list 100% of the business on the New York Stock Exchange,” said Mr Jenisch, who was confident of getting shareholder backing for the flotation.

The US business aims to boost annual sales from around $11bn at present to more than $20bn and generate operating profit of more than $5bn by 2030, the company said.

The rest of Holcim’s global business — in Europe, Latin America, Africa, and Asia —would remain listed on the Swiss stock exchange, and focus on materials such as roofing products.

Mr Jenisch, who has led Holcim since 2017, will remain as chairman and will lead the planned listing in the US, where building materials companies trade at higher earnings multiples than in Europe, potentially improving its valuation.

Describing the US as one of the world’s most attractive construction markets, Mr Jenisch said the move would help the new company capitalise on the region’s infrastructure and construction boom.

Holcim is the biggest cement maker in North America, where it employs 16,000 people across 850 sites.

The business competes in the region with companies like Carlisle, and RPM in building products and solutions, and Eagle Materials and Summit Materials in the cement industry.

The US business made up a fifth of Holcim’s sales in the first nine months of 2023, and was also the company’s most profitable region, with sales growing by more than 20% on average in recent years. The remaining Holcim business will employ 48,000 people.

The US operations were “simply too successful to be run as a subsidiary”, Mr Jenisch said.

• Reuters and Irish Examiner