Holcim/Cemex deal examined
By Sandy Guthrie21 October 2013
A proposed acquisition of Holcim's cement operations in Spain by rival company Cemex is to be investigated by the European Commission.
Following a request by Spain, the European Commission will assess the proposed acquisition under the EU Merger Regulation.
The Commission has concluded that the transaction threatens to affect competition within Spain, and that it is the best placed authority to assess the potential cross-border effects of the transaction.
It was felt by the Commission that the proposed acquisition by Cemex of Holcim's operations in Spain and the Czech Republic did not meet the turnover thresholds set by the EU Merger Regulation for mergers that must be notified to the European Commission because they have an EU dimension. It was therefore notified separately for regulatory clearance in Spain and the Czech Republic.
Spain submitted a referral request under a provision which allows Member States to request that the Commission examines a concentration that does not have an EU dimension, but that affects trade within the EU's internal market and threatens significantly to affect competition within the territory of the Member States making the request.
On the basis of the elements submitted by Spain, the Commission said it considered that the transaction threatened to impact competition in the Spanish cement, concrete and aggregates markets, since Cemex would acquire a stronger position in these markets in Spain.
As the Czech Republic did not join the request submitted by Spain, it will continue to examine Cemex' acquisition of Holcim's assets in the Czech Republic.
Cemex, based in Mexico, is a global building materials company. It produces, distributes and sells cement, ready-mix concrete, aggregates and related building materials.
The Swiss company Holcim is a global supplier of cement, aggregates, ready-mix concrete, asphalt and cementitious materials, as well as related services.
In another linked transaction, Holcim proposes to acquire a number of Cemex assets in Germany, France and the Netherlands. Holcim notified the proposed acquisition to the Commission on 3 September, 2013, because the transaction met the turnover thresholds of the EU Merger Regulation.
According to Cemex and Holcim, the interlinked transactions are intended to improve the two groups' strategic footprint in Europe.