Europe / Middle East / Africa
Anglo American and Lafarge forced to put cement plants up for sale
May, 02 2012
(UK) -- Quarries and cement plants across Britain are up for sale, after the competition watchdog told their owners they must "pave the way" for a new competitor to enter the UK cement market if they want to get the go-ahead for a joint venture.
Anglo American, the FTSE 100 miner which owns Tarmac, and French construction giant Lafarge must sell "a significant portfolio" in order to merge Tarmac with Larfage's UK operations, the Competition Commission announced.
The assets to be sold off include Lafarge's cement plant in Hope, Derbyshire, one of the largest in the country, as well as the nearby Dowlow quarry and three linked rail depots. The two firms must also sell more than half their ready-mix concrete capacity in the UK.
Roger Witcomb, who chaired the competition inquiry into the plans, said: "A large-scale disposal like this is the only way to get a new entrant of sufficient scale to break into the UK cement market and thereby ensure that this joint venture does not damage competition."
Mr Witcomb said it was particularly important to protect customers' interests given how much construction work the public purse funds.
The UK cement market is currently dominated by Lafarge, Tarmac, Cemex and HeidelbergCement's Hanson.
The watchdog ruled in February that the planned joint venture could damage competition. Anglo and Lafarge said they were "confident" that they could meet the conditions imposed, raising speculation that they had buyers ready.
Breedon Aggregates, the UK's biggest independent quarrying business, flagged its interest by saying it will "assess any specific opportunities" once more details are available.
The AIM-listed firm recently said it could comfortably spend up to £1bn on acquisitions.
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Nigeria’s Ashaka Cement, a unit of Lafarge, reported a 5% fall in half year pretax profit to $21m (4.17 billion naira) compared with the same period a year ago. More