EU antitrust regulator weighs in on Lafarge-Holcim deal

 
Guy Bentley
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Plans to merge the world's two largest cement companies will be subject to intensive review, according to the EU's boss of antitrust Joaquin Almunia.

Swiss company Holcim and French rival Lafarge, announced their intentions to merge last week in a move that could slash operating costs and boost group earnings.

The deal would result in the creation of the world's largest cement company that could control 40 per cent of cement manufacturing, with a market cap of over $50bn.

A merger would also prove highly complementary, with around a third of combined revenues coming from countries where only one company is currently present. Holcim and Lafarge are already the dominant players in the cement market in Asia, the Middle East and Africa.

Commissioner Almunia told reporters in Athens that the merger would require considerable examination before being approved.

"Last week the parties informed us of their intention but with very general information before the operation was known by the media. Now we will receive more detailed information because this should of course be analysed at our level," Almunia said.

Investment bank UBS has already warned that the merger could take up to two years to complete due to investigations that will arise from local competition authorities.

The merger will need to pass regulatory approval in 15 countries before being given the go-ahead. The European Commission would take 25 working days to conduct a preliminary review.