Iltalementi and HeidelbergCement, after the agreement reached in July, are proceeding with the integration of their activities in the Canadian market with the homologous activities of HeidelbergCement AG, a company which since last July 1, 2016 holds the relative majority in the share capital of Italcementi SpA and which, as a result of the results of the mandatory takeover bid, will achieve totalitarian participation. A press release was issued by Italcementi late on Tuesday evening.
The operation
The transaction consists in the acquisition by the company Lehigh Hanson Materials Limited (“LHM”), a Canadian company indirectly held by HeidelbergCement, of the total interest, in ordinary and preferred shares, in the capital of the company Essroc Canada ULC (“Essroc Canada"). Essroc Canada is currently owned by Essroc Corporation (“Essroc Corp.”), a company incorporated
indirectly held by Italcementi, through the vehicle company Essroc Netherlands Coöperatief UA (“New Essroc”). The consideration that Essroc will receive for the sale of Essroc Canada to LHM, equal to approximately 371 million Canadian dollars, will be paid through the assignment to Essroc of 42.288 newly issued LHM shares, equal to approximately 15,50, XNUMX% of the share capital
of LHM, and for the residual part in cash, for approximately 200 thousand Canadian dollars.
The phases of the operation
The operation will take place through two essential phases:
(i) Transfer of Essroc Canada shares: Essroc Corp., after converting its shareholder loan of approximately CAD 33 million into capital, will transfer its entire stake in Essroc through the vehicle company New Essroc Canada to LHM, for a consideration of no. 42.288 newly issued shares, corresponding to approximately 15,50% (after the increase referred to in the following point) of LHM's share capital, and a cash adjustment of approximately Canadian $200.000;
(ii) Capital injection by HCCH: At the same time, LHM's current sole shareholder, HeidelbergCement Canada Holding (“HCCH”), will contribute approximately C$135 million into LHM against the subscription of 15.388 newly issued shares of LHM itself, corresponding to approximately 5,64% of its share capital. As a result of the transaction, HCCH will hold a total of 84,50% of the capital of LHM.
Upon completion of the transaction, LHM's shareholders will sign a shareholders' agreement under which Essroc Corp. will be granted rights to protect its minority interest.
The opinion of the Committee for Transactions with Related Parties and Fairness
opinion of the Independent Expert
The transaction was submitted to the Committee for Transactions with Related Parties (“Committee”) of Italcementi SpA, which, in exercising the option provided for by article 6.2.(iii) of the Italcementi Related-Party Procedure, identified Credit Suisse as International the independent expert to be appointed to issue a fairness opinion on the adequacy of the transaction values and considerations,
as well as on the convenience and substantial correctness of the related conditions.
On 3 October 2016, the Independent Expert released his fairness opinion in relation to the transaction.
On the same date, the Committee issued its favorable opinion on the interest of Italcementi SpA and its shareholders in carrying out the transaction as well as on the convenience and substantial correctness of the related conditions.
The Company will draw up and publish pursuant to art. 5 of the regulation approved by Consob with resolution no. 17221 of 12 March 2010, as subsequently amended, the Information Document containing the information referred to in Annex 4 of the aforementioned regulation.
