LONDON (ShareCast) - (WebFG News) - AIM-listed construction materials group Breedon said on Thursday that the Competition and Markets Authority has raised concerns about its proposed acquisition of certain assets from Tarmac in exchange for a number of ready-mix concrete plants and a cash payment.
The deal, which was announced back in December, would see Tarmac buy 27 ready-mix concrete plants from Breedon, which would buy four aggregate plants and one asphalt plant from Tarmac.

The CMA has cleared Breedon's acquisition of the four quarries from Tarmac, but said there is a realistic prospect of decreased competition in three local areas in England and Wales in relation to the supply of ready-mixed concrete.

Following an initial Phase 1 review, the CMA found that the proposed merger would give rise to competition concerns in the supply of ready-mix concrete in the Cardiff, Bridgend and Carnforth areas, where the companies are close rivals.

"The lack of other strong suppliers of ready-mix concrete in these areas could mean that customers would face increased prices or a worse quality of service as a result of the proposed merger.

"With regard to Breedon's plans to acquire four aggregates plants and an asphalt plant from Tarmac, the CMA found no competition concerns and has cleared that part of the deal."

Breedon, which now has until 3 May to address the concerns outlined by the CMA, said the outcome is "not unexpected". Subject to agreement with the CMA, it expects to complete the acquisition later this summer.



At 1010 BST, the shares were up 0.4% to 83.30p.

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