It was supposed to be one of the greatest investment banking mandates in recent Swiss history. And yet, the planned spin-off of the American unit of the cement and building materials group is likely to go smoothly even without Swiss banks.
It looks like a top class deal: Holcim wants to separate the North American business and float it on the U.S. stock market as a completely independent company. The value of the spin-off is estimated at 35 to 40 billion dollars.
Goldman Winning the Race
According to an announcement made on Sunday, the group has appointed well-known Wall Street bank Goldman Sachs International and American boutique Perella Weinberg Partners as financial advisers. Swiss banks were not named – even though UBS harbors the ambition of becoming the sixth largest investment bank in the United States, following its takeover of Credit Suisse.
On the legal side, law offices Skadden, Arps, Slate, Meagher & Flom (Skadden) have been engaged for the United States, and law office Baer & Karrer, specializing in corporate law, has been engaged for Switzerland,
Ambitious Plans for Growth
According to an analysis at Zuercher Kantonalbank, the U.S. unit of Holcim achieved revenue of around 11 billion dollars in 2023 and earnings before interest and taxes of 2 billion dollars. This corresponds to around 35 or 37 percent of the whole group’s figures.
Holcim specified an EBITDA margin of 27 percent for the unit for 2023. Over the last four years, the average growth rates have increased by around 20 percent, and the operating profit has grown by over 26 percent. Based on the plans, the revenue is to rise to more than 20 billion dollars and the EBIT to over 5 billion dollars by 2030.
Completion in the First Half of 2025
The planned spin-off can be considered the biggest strategic win that parting CEO Jan Jenisch (image below) has made. He will focus on his role as chairman of the board of directors. At the same time, it was announced that his successor Miljan Gutovic, currently head of Europe for the group, will take on the operational management at the beginning of May.
The timescale given for the U.S. listing is the first half of 2025.
(Image: Holcim)
In early trading, the Holcim shares gained up to 6.7 percent. They are currently trading at 66.72 Swiss francs (3.9 percent).
