Shares in French cement maker Lafarge fell 1.4% to trade at 64.30 after a report in a Swiss weekly newspaper over the weekend said Holcim's largest shareholder has doubts about the tie-up of the two companies ahead of investors voting on the deal.
are holding up well, up 0.8% to CHF74.88 on the back of a report in the Swiss weekly newspaper SonntagsZeitung billionaire Holcim investor Thomas Schmidheiny, who owns just over 20% of the company, wants a better deal for investors in the merger.
On Monday however, Thomas Schmidheiny reportedly said the agreed merger with Lafarge SA to form the world's biggest cement maker still makes sense after his comments over the weekend. Holcim issued a statement saying it had no comment on the report.
The planned deal between the two cement giants is expected to go to a shareholder vote, for which no date has yet been set. The latest news around the merger of the two giants come after both began a lengthy process of working out the combination and synergies of the deal.
Holcim's strong performance in the fourth quarter of 2014 threw another spanner in the works as the robust shape of the company fuelled its shareholders and investors to re-assess the terms of the deal.
Furthermore, January's unexpected move by the Swiss central bank to remove the ceiling on the Swiss franc against the euro led to a surge by the Swiss currency against the euro.
As such, analysts note that the proposed deal is appearing less attractive to investors in the Swiss company as the market value relative to Lafarge has risen with Holcim now capitalised at $24.7bn compared to Lafarge at $20.7bn.
To reassure shareholders over the tie-up, Holcim and Lafarge are considering paying a special dividend after agreeing to sell assets to CRH for 6.5bn to address antitrust hurdles, two people familiar with the discussions said last month.
Jefferies said that though uncertainties still remain regarding CRH's proposed acquisition of the Lafarge/Holcim assets, "we believe the probabilities are firmly weighted in the deal's favour". The broker retains a 'hold' rating on CRH and raises the price target to 1800p from 1400p.
Meanwhile, Deutsche Bank also maintained its hold rating with 1964p price target on CRH saying that from the integration of the Lafarge/Holcim assets, CRH targets 1.8% of revenue in synergies. "CRH believes it will show strong deleveraging of the balance post the acquisition of the Lafarge/Holcim assets," added Deutsche Bank.