Lafarge in $15 Billion Orascom Cement Business Acquisition

Cleary Gottlieb represented Lafarge S.A., the world leader in building materials, in its acquisition of Orascom Building Materials Holding S.A.E. (Orascom Cement) from Orascom Construction Industries S.A.E., an Egyptian construction and building materials group founded by the Sawiris family, for $15 billion (including assumed debt), or €10.2 billion. Orascom Cement is an emerging markets cement leader, with number-one positions in Egypt, Algeria, the United Arab Emirates and Iraq, and with strategic positions in other growth markets in Africa and Asia including Saudi Arabia, Syria and Turkey. The transaction was entered into on December 9, 2007 and closed on January 23, 2008.

The purchase price is being financed by €6 billion in debt and the issuance, through a reserved capital increase, of 22.5 million new Lafarge ordinary shares at a price of €125 per share for a total capital increase of €2.8 billion, to NNS Holding Sàrl, a holding company owned by Nassef Sawiris and his family, which owns 60% of Orascom Construction Industries. Through this investment, NNS Holding will become an 11.4% shareholder of Lafarge, and Nassef Sawiris will be entitled to appoint two members of Lafarge’s board of directors.