The Senate has cleared the proposed $1 billion acquisition of Lafarge Africa Plc by Hainan Huaxin Pan-African Investment Company Plc, a Chinese investment firm, after lawmakers concluded that the transaction does not threaten Nigerian shareholders’ interests.
The upper chamber approved the deal on Thursday after adopting the report of its ad hoc committee chaired by Senate Minority Leader, Abba Moro.
The committee was set up seven months ago to examine the proposed sale by Holcim AG, Lafarge Africa’s Swiss majority shareholder, following concerns over the company’s ownership structure, regulatory compliance and the possible impact of the transaction on Nigeria’s cement industry.
According to the Senate report, the 16.19 percent equity held by Nigerian investors in Lafarge Africa will remain unchanged after the acquisition.
Senate says deal can proceed
Presenting the committee’s findings, Moro said the panel engaged relevant stakeholders and found no legal obstacle preventing the transaction from going ahead.
He said the acquisition should be allowed to proceed, provided all parties comply fully with Nigerian laws and submit to proper regulatory supervision.
The Senate also directed key agencies to closely monitor the process. These include the Securities and Exchange Commission, the Corporate Affairs Commission, the Federal Competition and Consumer Protection Commission, the Nigerian Investment Promotion Commission and the Bureau of Public Enterprises.
The committee said these institutions must ensure that the transaction follows due process and protects the interests of shareholders, employees, host communities and the wider economy.
Nigerian stake remains protected
One of the major concerns around the sale was whether Nigerian investors would lose their stake in Lafarge Africa.
The Senate committee said that fear was based largely on a misunderstanding of the company’s ownership structure.
According to the report, the deal is not the sale of a wholly Nigerian-owned company. Rather, it is the transfer of a majority foreign stake from one foreign investor to another.
Holcim, the Swiss cement and building materials group, is divesting its stake to Hainan Huaxin Pan-African Investment Company. The committee said this would not reduce or alter the 16.19 percent equity currently held by Nigerian investors.
The report also stated that regulatory agencies did not find evidence that the acquisition breached Nigerian law or posed an immediate national security risk.
Fresh capital expected
The committee said Huaxin had committed to injecting new capital into Lafarge’s operations in Nigeria and across Africa.
Lawmakers said the investment could strengthen the company’s operations, support industrial growth and encourage foreign direct investment.
The report also noted that Lafarge Africa controls about 18 percent of Nigeria’s cement market. Based on that market share, the committee said the acquisition would not substantially distort competition in the cement industry.
The Federal Competition and Consumer Protection Commission was also said to have received assurances from the acquiring company that workers would not be laid off during the transition.
The Senate further urged the new investors to strengthen corporate social responsibility programmes in Lafarge’s host communities.
Ningi questions ownership details
During debate on the report, Senator Abdul Ningi, representing Bauchi Central, raised concerns about the clarity of the ownership structure presented to lawmakers.
Ningi said the report stated that Nigerian interests hold about 16 percent of Lafarge Africa, while Holcim controls 18 percent. He questioned who owns the remaining 66 percent of the company.
He argued that lawmakers needed a clearer breakdown of the company’s shareholding before determining whether Nigerians would benefit from the transaction.
Ningi also said the deal should be properly understood as a transfer between foreign shareholders, not the sale of a strategic Nigerian asset.
He urged the committee to provide stronger legal and ownership details to guide the Senate’s approval.
Lawmakers adopt report
Despite the concerns, other lawmakers supported the committee’s recommendations.
Senator Osita Izunaso, Chairman of the Senate Committee on Capital Market, and Senator Shuaib Salisu of Ogun Central backed the report and urged the chamber to allow the transaction to proceed under regulatory supervision.
The Senate later adopted the committee’s report, giving legislative backing to the proposed sale.
One thought on “Senate Backs $1bn Lafarge Africa Sale to Chinese Investor”