The Senate has endorsed the proposed $1 billion acquisition of Lafarge Africa Plc by Chinese firm Hainan Huaxin Pan-African Investment Company Plc, concluding that the transaction poses no threat to Nigerian shareholders or the country’s regulatory framework.
The approval followed the adoption of a report by an ad hoc committee established to investigate the proposed sale after concerns were raised over its implications for local investors, competition and national interests.
Presenting the report during plenary on Thursday, Chairman of the committee and Senate Minority Leader, Senator Abba Moro, said extensive consultations with relevant stakeholders showed that there were no legal obstacles to the acquisition.
He explained that the transaction should proceed, provided all applicable laws and regulatory requirements are fully complied with.
“The Senate allowed the transaction process concerning the sale of Lafarge Cement Company Plc to Huaxin to scale through,” Moro said.
“However, all due processes and strict compliance with all Nigerian extant laws on the subject must be followed and adhered to strictly for a hitch-free transaction and transition process.”
The committee noted that the acquisition involves the transfer of ownership from one foreign investor to another, as Swiss cement giant Holcim AG is divesting its majority stake in Lafarge Africa to the Chinese company.
According to the report, the deal will not affect the 16.19 per cent shareholding held by Nigerian investors, including institutional and public shareholders.
It said concerns surrounding the transaction were largely driven by the mistaken belief that Lafarge Africa is wholly Nigerian-owned.
“The proposed acquisition represents the transfer of ownership from one foreign investor to another and does not diminish or alter the rights of Nigerian shareholders,” the report stated.
The committee also disclosed that regulatory agencies found no indication that the transaction violates Nigerian laws or poses any immediate national security concerns.
It further recommended that key regulatory bodies, including the Securities and Exchange Commission (SEC), Corporate Affairs Commission (CAC), Federal Competition and Consumer Protection Commission (FCCPC), Nigerian Investment Promotion Commission (NIPC) and Bureau of Public Enterprises (BPE), maintain close oversight throughout the acquisition process.
Lawmakers also urged the incoming investors to strengthen corporate social responsibility initiatives in communities hosting Lafarge operations.
According to the committee, Huaxin has indicated its willingness to inject fresh capital into Lafarge’s Nigerian and African operations, a move expected to enhance production capacity, support industrial growth and attract additional foreign investment into the economy.
The report added that Lafarge Africa currently controls about 18 per cent of Nigeria’s cement market and that the acquisition is unlikely to significantly alter competition within the sector.
It also cited assurances from the FCCPC that the acquiring company had pledged not to undertake workforce reductions during the transition period.
However, the report generated debate on the Senate floor, with Senator Abdul Ningi of Bauchi Central raising questions about the company’s ownership structure.
Ningi observed that while the report stated that Nigerian interests hold 16.19 per cent of Lafarge Africa and Holcim owns 83.81 per cent, there was insufficient explanation of the broader shareholding framework.
“I would have imagined that the report of the committee should specifically give us the shareholding structure,” Ningi said.
“It is only when we know who owns the remaining shares that we can determine whether Nigerians are actually benefiting from this transaction.”
He also argued that the transaction was essentially a transfer of shares between two foreign entities rather than the sale of a strategic national asset.
“There is a misconception about the ownership of Lafarge. The current development is basically the transfer from one foreign ownership to another. Lafarge is a foreign company transferring its shares to another foreign company,” he said.
Ningi further urged the committee to clearly identify the legal provisions governing such transfers and provide more detailed information on the ownership structure.
Despite the concerns, several lawmakers, including Senator Osita Izunaso, Chairman of the Senate Committee on Capital Market, and Senator Shuaib Salisu of Ogun Central, supported the committee’s recommendations.
The Senate subsequently adopted the report, effectively giving legislative backing to the transaction.
The approval comes months after lawmakers launched an investigation into Holcim Group’s plan to divest its 83.81 per cent controlling stake in Lafarge Africa.
During the inquiry, the SEC informed lawmakers that it had not received a formal application relating to the sale and had only been notified of an internal restructuring exercise involving Holcim.
Similarly, the Bureau of Public Enterprises clarified that the shares being sold belong exclusively to Holcim and have no bearing on the 16.19 per cent equity held by Nigerian investors.