M&A : the case of Secil and Lafarge Betões

Abstract

The drive of the choice of the acquisition of Lafarge Betões by Secil as the subject of this dissertation was to try to understand the rational of investing in a business that is currently in a very adverse economic environment. The forecast in this uncertain period is now a question of believe. Secil believed that, in Portugal, in this recessionary environment was worth paying €65 million for Lafarge Betões. Secil had a long term perspective that the Portuguese economy and the industry will recover and the acquisition will bring a dominant market position overtaking Cimpor and improved efficiencies that will contribute to a better performance in 2014-2015 when the economy will start growing. The holding company Semapa is negotiating the acquisition of the remaining 49% share in Secil and was recently a candidate to the acquisition of Cimpor. It is this investment effort in the Portuguese industry, the optimistic believe of the “captains of industry”, that has attracted my curiosity and justified the choice of this subject.