Lafarge, Holcim name Eric Olsen as chief of merged group

Thu Apr 9, 2015 9:25am EDT
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By Oliver Hirt and Leila Abboud

ZURICH/PARIS (Reuters) - Lafarge LAFP.PA and Holcim HOLN.VX have picked Lafarge insider Eric Olsen as chief executive of their combined company, potentially opening the way for the two cement groups to clinch their $40 billion merger, if shareholders back it next month.

Olsen, a 16-year veteran at Paris-based Lafarge, will take on the challenge of knitting together the two companies to deliver a promised 1.4 billion euros ($1.50 billion) in cost savings.

He said he was ready for the task of extracting these benefits from the merger and of forging a coherent new company from the Swiss and French groups.

"I see my role not only as the operational leader but also as the integrator of cultures," he said at a press conference on Thursday.

The CEO role was a major sticking point when the tie-up between the French and Swiss companies came close to collapse in March. The two groups eventually agreed new terms aimed at satisfying discontented Holcim shareholders, but the top job remained a problem.

Holcim's second-biggest shareholder Russia's Eurocement and third-biggest Harris Associates have expressed misgivings about the deal, and have yet to speak publicly on Olsen's appointment.

Shares in Holcim rose 3.6 percent and Lafarge 4.7 percent at 1312 GMT in response to Olsen's appointment.

Since the deal was announced last April, Holcim investors had watched the companies' relative business performances diverge. A stronger Swiss franc also became a factor, along with questions over the management style and record of Bruno Lafont, Lafarge CEO, who was to be CEO of the merged company.   Continued...

Future CEO Eric Olsen of the new merged entity LafargeHolcim smiles during a news conference in Zurich April 9, 2015.    REUTERS/Arnd Wiegmann