French cement maker Lafarge will combine its South Africa business with publicly traded Nigerian unit Lafarge Wapco  listing its Africa interests together on the Lagos bourse, its country chief executive officer said on Tuesday according to reports by Reuters..

Guillaume Roux said the deal, worth $1.35 billion, will see the Lafarge group pay $200 million in cash and issue 1.40 billion in new shares in Lafarge Wapco to minority investors to effect the merger.

The new company Lafarge Africa Plc will have a market capitalisation of over $3 billion listed on the Nigerian Stock Exchange, Roux told a news conference. Lafarge group will own 73 percent of the combined entity.

The combined company would seek to boost capacity by 5.5 million tonnes to 17.5 million tonnes after the merger.

“The consolidation will enable the enlarged entity to accelerate growth on the continent and expand its product offering in South Africa across the region,” Roux said.

He said Standard Chartered Bank and Nigerian-based investment bank Chapel Hill Denham was advising it on the merger. He said Lafarge Africa will become the sixth most capitalised company on the Nigerian bourse.

Lafarge faces intense competition in Africa, especially from its arch rival Dangote Cement, owned by Africa’s richest man Aliko Dangote. The firm, Nigeria’s biggest with a market capitalisation of around $24 billion, is set to roll out cement plants across Africa.