Lafarge Nigeria’s Stock Plunge Amid $778m US Fine

Lafarge Africa Plc’ stock price dropped at the Nigerian Exchange Limited at the close of market on Tuesday, after a fine of $778m by the United States over terrorism charges.

The company’s share price dropped by 2.13 per cent, losing 0.5 Kobo per share to close at N23 per share against N23.5 Kobo per share it recorded in the initial day.

Meanwhile, the shares of Holcim Group, the company that recently bought Lafarge, were temporarily suspended on the Swiss stock exchange after news of the fine emerged.

However, on the Switzerland stock exchange, the share price remained on the high with 2.83 percent gain to close at 42.82CHF per share.

Holcim maintained a similar bullish trend on the stock market in France with 4.13 percent gain to close at €44.15 per share at the close of Market on Tuesday.

According to reports issued by foreign media, French cement giant pleaded guilty in the U.S to supporting the Islamic State and other terror groups.

Consequently, the firm agreed to a $777.8m penalty for payments it made to keep a factory running in the war-torn Syria after war broke out in 2011.

The company said it “deeply regretted the events and accepted responsibility for the individual executives involved.”

Foreign news agencies also reported that the US prosecutors said Lafarge’s Syrian subsidiary had paid Islamic State and al Nusra Front the equivalent of $5.92m to protect staff at the plant as the country’s civil war intensified.

However, the company permanently closed the factory in 2014, the deals assisted the company do $70.3m in sales, prosecutors stated.

In a statement issued, Lafarge’s new owner Holcim said none of the conduct involved Holcim, “which has never operated in Syria.”

It added that former Lafarge executives involved in the bribery had hidden it from Holcim, and external auditors.

The previous Head of Holcim and Lafarge, Eric Olsen, had stepped down from his role as a result of an investigation into the company’s activities in Syria.

The Swiss conglomerate said the event only came to its attention in 2016, noting that the US Justice Department had cleared it of any wrongdoing.

According to BBC, Breon Peace, US Attorney for the Eastern District of New York – where the case was brought – said the conduct “by a Western corporation was appalling, and has no precedent or justification”.

“The defendants paid millions of dollars [to Islamic State], a terrorist group that otherwise operated on a shoestring budget, millions of dollars that [Islamic State] could use to recruit members, wage war against governments, and conduct brutal terrorist attacks worldwide, including against U.S. citizens,” he said at a press conference announcing the guilty plea.

Lafarge also faces charges of complicity in crimes against humanity in France because of its activities in Syria, however, the company denies the claims.