Lafarge and Holcim have reportedly been shown the green light from the Competition Commission of Singapore to merge their local operations. AsiaOne Business website writes that the merger, with Holcim acquiring Lafarge's entire issued share capital, will result in Holcim being renamed LafargeHolcim. Holcim (Singapore) and Lafarge Cement Singapore overlap in the manufacture and supply of ready-mixed concrete. They also supply grey cement, used to produce mortar and concrete, here.
Lafarge and Holcim have reportedly been shown the green light from the Competition Commission of Singapore to merge their local operations.
AsiaOne Business website writes that the merger, with Holcim acquiring Lafarge’s entire issued share capital, will result in Holcim being renamed LafargeHolcim.
Holcim (Singapore) and Lafarge Cement Singapore overlap in the manufacture and supply of ready-mixed concrete. They also supply grey cement, used to produce mortar and concrete, here.
Under Singapore’s Competition Act, firms are not allowed to merge if the resulting entity could lead to a substantial lessening of competition in any market here. But the firms in July argued they will not have substantial market power after the merger.
Grey cement is also imported by Holcim primarily for its own consumption, and is supplied to third parties only to a limited extent, they said.
After a public consultation exercise, the Competition Commission issued its decision that “the transaction is unlikely to lead to substantial competition concerns in Singapore”. This was, reports AsiaOne Business, because the firms are not the biggest players in Singapore, despite being major names in overseas markets, including Europe.
The Competition Commission are reported as saying: “There is significant localised competition in the relevant overlapping markets in Singapore.”
There are also alternative suppliers that can meet any additional demand for ready-mixed concrete, thereby limiting the market power of the merged companies.
With a number of suppliers in the market, cooperation among firms to raise prices is also expected to be harder.
