Chartered Institute of Building Magazine of the Chartered Institute of Building


Competition watchdog flags up materials giants’ deal

26 August 2020

The Competition and Markets Authority (CMA) has raised concerns over a proposed acquisition deal involving two large construction materials firms.

The investigation into Breedon Group’s £178m acquisition of around 100 Cemex sites, completed last month, found that such a deal could result in a substantial lessening of competition, leading to higher prices and lower quality building materials for UK construction projects.

The CMA has issued a statement relating to the investigation, which found that the deal may impact competition levels in the supply of ready-mixed concrete, non-specialist aggregates or asphalt in 15 local markets across the UK.

Breedon and Cemex are subject to limited competition from other suppliers in each market, the CMA said.

The acquired sites include aggregate quarries, ready-mixed concrete facilities and a cement terminal.

Colin Raftery, senior director at the CMA, said: “As the majority of these materials are sourced locally, it’s vital to ensure that enough competition will remain at the local level so there’s enough choice and prices remain fair.

“While sufficient competition will remain in most areas, we are concerned that the deal could result in high prices and lower quality products in some areas where Breedon wouldn’t face sufficient competition.”

The CMA could commence an in-depth phase two investigation if Breedon and Cemex cannot address concerns within five working days.