Currently holding 10 percent of Cimpor, Holcim will retain a strategic interest in the Portuguese cement producer, which has a significant international network. Thus, Holcim is assisting the Spanish investor group, Cartera Lusitania, to acquire a Cimpor share package of its own and continues to seek a forward-looking solution for all Cimpor shareholders.

In June 2001, Holcim Ltd. decided not to submit a bid for the Portuguese government's stake in Cimpor. The decision was prompted primarily by the high price as well as restrictive articles of incorporation. Holcim had previously acquired 10 percent of Cimpor's share during the run-up to privatization.

With cement operations in Portugal, Spain, Morocco, Tunisia, Mozambique, and Brazil, Cimpor would consolidate and expand Holcim's global market presence. Consequently, Holcim continues to monitor developments surrounding the company with great interest.

In view of the ongoing stalemate, Fernhill Holdings N.V., a primary investor, has decided to sell its shares to the Spanish investor group Cartera Lusitania SA. The acquisition price for this share package of 9.5 percent is fixed at EUR 23.50 (US$20.63) per share, a financial commitment of EUR 299 million (US$262.6 million). Based on the strategic importance of its current Cimpor investment, Holcim has entered into a “Total Return Swap” agreement with Cartera Lusitania.