CVC preparing bid for Lafarge/Holcim cement companies?

CVC is preparing a joint bid with a Singaporean state fund for assets including Britain's biggest cement-maker, Sky News reports.

The private equity company CVC Capital Partners is reported to be joining forces with some of the world's biggest sovereign wealth funds to bid for £4 billion (€5 billion) of cement assets that would make it a major player in the building materials sector.

Sky News reports that CVC is in discussions with Singapore's Government Investment Corporation (GIC) about a combined offer for a package of businesses being sold by 680 Holcim and 725 Lafarge, as they look to seal a £32 billion (€40 billion) merger.

CVC, which is best-known for its controlling stake in Formula One motor racing, is also understood to be talking to other state investment funds about teaming up on the proposed deal.

The disposals being planned by Holcim and Lafarge include Britain's biggest cement maker, 7235 Lafarge Tarmac, which the French group said it would take full control of in order to make a full sale of the business easier.

Lafarge said it would pay at least £885million (€1.1 billion) to 722 Anglo American, the mining group, for its 50% stake in the 868 Tarmac division, which is also likely to attract interest from other industry players.

Holcim and Lafarge will also sell assets in other markets inluding Austria, France, Germany and Hungary in order to smooth the regulatory passage of their deal, which is one of the biggest mergers in any industry to be announced so far this year.

At least two other private equity consortia have been formed to bid for the cement operations which are being spun out of the combined group: Blackstone has teamed up with Cinven and the Canada Pension Plan Investment Board, while BC Partners and Advent International are also preparing a joint bid.

Initial offers are understood to be due next month.