Cement makers Holcim and Lafarge are discussing a new CEO appointment to the combined group that would see current Lafarge boss Bruno Lafont in a different role, sources said today.
The two companies are seeking to save their troubled merger, first announced last April.
When the deal was announced, Lafont was presented as the future CEO of what would be the world's biggest cement maker.
But the Swiss side has since grown dissatisfied with his leadership and threatened to walk away if the issue is not resolved, the sources added.
"The discussions are ongoing on all aspects of the deal, on the share exchange ratio and the governance," one of the sources said.
A second source said that Holcim was not calling into question that the marriage of the two groups was of equals - a concept that underpinned the deal's price and terms and allocated seven seats for each side on the board.
Another source said Lafont could be named co-chairman of the future company, alongside Wolfgang Reitzle, the current chairman of Holcim.
Holcim and Lafarge presented the deal originally as a merger of equals with a one-for-one share swap, which would leave Holcim 53% of the new group.
But as the two sides spent months working on asset sales to get regulatory approvals, the performance of the two groups diverged, leading Holcim, under pressure from its shareholders, to call a halt to the deal under its old terms on Sunday with a letter to the Lafarge board.
It demanded better terms on the share exchange ratio and changes to the "governance" of the new group.
The decision to try to find a new role for Lafont within the combined group came about yesterday after the two largest shareholders of Lafarge, who together own 37% of the shares and hold five board seats, pushed for the French group to open discussions to save the deal, the third person said.
Belgian investors Paul Desmarais and Albert Frere own 21% of Lafarge via a holding company, while Egyptian businessman Nassef Sawiris owns 16%.
An agreement could be found between Holcim and Lafarge and announced later today or tomorrow, two of the sources said.
There is pressure to find an accord soon because CRH, which is supposed to buy a chunk of European assets from Lafarge and Holcim to help them get competition clearance, has a shareholder meeting scheduled for tomorrow to ratify the acquisition.
CRH shares rose 4.4% to close at €24.48 in Dublin today.
