Competition Bureau green lights Holcim’s North American asset sell-off plan
By On-Site MagazineConcrete Construction Financing
Assets must be sold to one or two buyers
The Competition Bureau has given the green light to Holcim Ltd to sell off its Canadian holdings as part of the firm’s merger with Lafarge S.A.
Under the agreement, Holcim will also sell one cement plant and five cement terminals in the United States. The sale of the U.S. cement plant is required to allow the Canadian assets to run effectively as a stand-alone business once they are no longer associated with other Holcim assets.
The agreement requires Holcim to sell the assets to a single purchaser or in two packages to two purchasers:
- The first package includes two cement terminals located in Lethbridge and Edmonton (AB), along with a cement plant located in Three Forks, Montana (U.S.) determined by the Bureau to be essential to Holcim’s operations in Alberta.
- The second package includes Holcim’s cement plants located in Joliette (QC) and Mississauga (ON), as well as many cement terminals, ready-mix concrete plants and other aggregates and construction facilities. It also includes five cement terminals in the northeastern United States.
As the parties decided upfront to sell all of Holcim’s Canadian operations to address competition concerns in Canada, the Bureau’s review was focussed on determining whether assets located outside of the country were important to the effectiveness of Holcim’s Canadian business.
The Competition Bureau Commissioner has the sole discretion to approve a buyer for the assets to be sold under the agreement and will only do so if he concludes that a buyer will provide effective competition in Canada.
In this global transaction, the Bureau coordinated with the U.S. Federal Trade Commission (U.S. FTC) and the European Commission to align its merger review process. In addition, as some assets being sold serve both U.S. and Canadian markets, the Bureau worked very closely with the U.S. FTC throughout its review in order to achieve an effective remedy in both jurisdictions.
“This merger review demonstrates how the Bureau and its international counterparts can work together to ensure an effective remedy in each jurisdiction and strengthen competition law enforcement partnerships,” says John Pecman,
Commissioner of Competition.
“I commend the parties for the level of cooperation they provided to the Bureau throughout our review of the proposed transaction and for reaching this agreement, which will preserve competition in the supply of cement and related products throughout Canada to the benefit of Canadian consumers and businesses.”
- This agreement addresses the likely substantial lessening or prevention of competition that would otherwise arise in Canada from the merger of Holcim and Lafarge.
- Holcim has included in the agreement five cement terminals located in the U.S., which it believes will enhance the attractiveness of the package.
- In Canada, Holcim currently employs about 2,600 people and manufactures cement, aggregates and ready-mix concrete and provides construction services.