Tarmac and Lafarge tie up means large asset sell off

The tie up between Anglo American’s Tarmac and French building giant Lafarge has been given the go ahead by the Competition Commission as long as they both sell off a large amount of assets.

Tarmac and Lafarge would dominate the construction market as a joined force, and could damage competition it was stated by the industry watchdog in February when the deal to merge was announced.

At the time of the ruling in February, Anglo and Lafarge said they were sure they could meet conditions to the deal, which prompted rumours about buyers ready to take on the assets.

The asset sell off will include Lafarge’s cement plant in Hope, Derbyshire, which is one of the biggest in the UK, and the nearby Dowlow quarry and three linked rail depots. Both companies are also to dispose of over half of their ready-mix capacity in Britain.

Speaking to the Telegraph, Roger Whitcomb, who chaired the competition inquiry into the plan, 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.”

Lafarge, Tarmac, Cemex and HeidelbergCement’s Hanson presently head the cement industry in Britain.

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