Lafarge and Aso Cement Company Limited create joint venture

14 February 2001

Lafarge and Aso Cement Company Limited have agreed to create a joint venture in the cement business and signed an agreement on principles for a strategic alliance.

Aso Cement will separate its cement division from the other activities in order to allow for the creation of the new joint venture company. This new company will take over Aso's cement related business assets, including two plants in Kyushu, the Tagawa Plant with a cement capacity of 1.7 millions tonnes, and the Kanda Plant with a capacity of 1.3 millions tonnes, as well as a network of 24 service stations and holdings in other businesses, such as ready-mix concrete companies.

Under the terms of the joint venture, Lafarge will own 39.4 percent of total shares and Aso 60.6 percent. The new company will take over the existing name of Aso Cement while the current Aso Cement Company Limited will be renamed Aso Corporation. The creation of the joint venture is subject, inter alia, to the approval of the shareholders of Aso Cement.

This strategic alliance will enable the new joint venture to :
- benefit from the network of positions already established by Lafarge in Asia and Aso Cement in Japan;
- build on the potential of the Japanese cement market with the help of Aso Cement's brand name and image;
- apply the best practices and technologies of both parent companies to the Japanese cement and ready-mix concrete operations.

The President and CEO of the Aso Group, Yutaka Aso, said: "it is essential for every company to adapt itself to the rapidly changing business environment; this joint venture will allow Aso Cement to maximize both its growth and value creation potential". He added: "Joining forces with the world leader in the cement field will allow Aso Cement to become more efficient and more competitive at a time when the consolidation in this business makes it not only suitable but mutually beneficial.

The Chairman and CEO of Lafarge, Bertrand Collomb, said: "With this partnership in Japan, Lafarge reinforces further its presence in Asia, by entering into a country which traditionally has an important regional influence. We are happy to do so with the backing of a well-known and well established partner, with whom Lafarge has enjoyed a long relationship".

In order to maximize the benefits of this alliance, Aso Cement and Lafarge will set up an alliance committee which will meet regularly to discuss strategy and long term business planning for the new company.

The Aso Group is headquartered in Iizuka City, Fukuoka, Japan. With 5,200 employees, the Aso Group had aggregated revenues of about Euro 1.5 billion (166 billion JPY in 2000).

Lafarge is a Paris based company with 66 000 employees located in more than 70 countries. It generated sales of Euro 12.2 billion in 2000.

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