Nassef Sawiris Has Even Grown Richer, Selling Orascom Cement To Lafarge

THE FIRST SEEDS OF THE ORASCOM DEAL were sown at a conference in London, where Bruno Lafont, chief executive of Lafarge, the world’s largest cement company, spoke alongside NassefSawiris, a member of Egypt’s richest family and chief executive of Orascom Cement. “There were two speakers in the cement sector and we were sitting close together,” Lafont explains with a Gallic laugh. “We had never met before. I was interested to know how [Orascorn] was doing business. What was he doing differently from us? I spent five years in Turkey and I learned there that entrepreneurs can have different approaches that can be extremely smart.”

Lafont and Sawiris met again last summer. Lafont was impressed that Orascom had begun as a local, general construction business and was therefore able to anticipate demand for materials much earlier than Lafarge. Orascom had a presence in Egypt, Algeria, northern Iraq, the UAE and Pakistan and has plants under construction in Saudi Arabia, Syria, Nigeria, South Africa, North Korea and Turkey. Lafarge, by contrast, was only in Egypt and Turkey, though it had announced plans to build 45m tones of new cement capacity — about 25 new plants — in 20 countries, mostly emerging market by 2010. But Orascom would give Lafarge another 45m tones of cement capacity by the same date. Little surprise then that a takeover was decided upon. The deal includes $40MM equity, and leaves Sawiris with an 11.4% stake in Lafarge. Shares in Lafarge, a leading member of the CAC 40, rose 13% on the announcement as investors and analysts backed the deal.

-From Business, a UK Weekly, January 3-8, 2008


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