News story

European Commission decision matches CMA cement order

The EC yesterday cleared the merger in Europe between Lafarge and Holcim subject to divestments in a number of countries – including the sale of most of the Lafarge Tarmac business in the UK.

The merged Holcim/Lafarge business will retain one cement plant previously owned by Lafarge Tarmac in the UK (a 50:50 joint venture between Lafarge SA and Anglo American plc) as well as Aggregate Industries (Holcim UK’s business).

The sale of the Lafarge Tarmac business will create a fifth independent cement producer in the UK which is consistent with the Competition Commission’s (CC) report published in January 2014 following its investigation into aggregates, ready-mix concrete and cement.

In this report, the CC had ordered Lafarge to sell one of two cement plants it owns in the UK to an independent cement producer to increase competition.

This CC’s decision was appealed by Lafarge Tarmac to the Competition Appeal Tribunal (CAT) but the proceedings were stayed pending developments with the European Commission (EC) investigation of the Holcim/Lafarge merger. The case was originally listed for hearing in September 2014 but has been stayed until April 2015. The CMA took over responsibility for the case from the CC in April 2014.

The EC yesterday announced its decision to clear the Holcim/Lafarge merger subject to a commitment from the parties that the UK Lafarge Tarmac business (except the Cauldon cement plant in Staffordshire) will be divested to a company not currently involved in UK cement production.

In light of the above, the CMA provided its consent for Lafarge S.A to transfer the Cauldon cement plant to the merged entity and has published a notice confirming this.

The CMA is grateful for the close and efficient cooperation that the EC maintained with the CMA throughout its merger investigation.

The CAT proceedings remain stayed at present.