CCM gives green signal to Holcim & Lafarge SA merger but conditions apply
The Competition Commission of Mauritius (CCM) was scrutinising the Holcim & Lafarge SA merger due to concerns around the Mauritian cement market but the merger has finally been approved with certain conditions attached to disinvestment in Holcim Mauritius Ltd. (Image: )
The Competition Commission of Mauritius (CCM) has finally given its green signal to the proposed merger of cement majors Holcim and Lafarge SA, subject to undertakings provided by the merging parties.
In particular, it has been highlighted that Holcim Ltd will have to find an independent purchaser to whom it will divest its shares in Holcim (Mauritius) Ltd, and the purchaser will have to be approved by the CCM.
Last year, on 23 July 2014, Holcim Ltd and Lafarge SA made a joint notification for guidance to the CCM wherein they notified the CCM of their intention to merge on the global front.
Holcim Ltd and Lafarge SA have interest in Holcim (Mauritius) Ltd and Lafarge (Mauritius) Cement Ltd respectively and in their notification, the parties informed the CCM that they are willing to divest their interests in Holcim (Mauritius) Ltd to address any competition concerns with respect to the cement market in Mauritius.
The proposed merger of Holcim and Lafarge was under investigation by the Competition Commission Mauritius (CCM) due to the potential concerns that the merger could have raised in the cement market in Mauritius.
The Commissioners have now decided that the CCM is satisfied with the recommendations of the Executive Director and considers that the undertakings will satisfactorily address the concerns, which the CCM has about any prevention, restriction, distortion or substantial lessening of competition.
Accordingly, CCM approves the appointment of the ‘Hold Separate Manager’ as recommended by the Executive Director, and CCM will keep under review the performance of the undertakings given by the notifying parties.
The executive director of CCM, Deshmuk Kowlessur said, “Now that the Commission has given its go ahead to the proposed merger, subject to the Undertakings provided by the merging parties, the CCM will start monitoring the implementation of the Undertakings. Holcim Ltd, Lafarge S.A and Holcim (Mauritius) Ltd will from now on, have to report to the CCM on the implementation of the undertakings. In particular, Holcim Ltd will have to find an independent purchaser to whom it will divest its shares in Holcim (Mauritius) Ltd. Once it identifies the potential purchaser, it will have to seek the approval of the CCM in relation to the purchaser. Holcim Ltd and Holcim (Mauritius) Ltd will now have to ensure that their businesses are managed separately, except as permitted by the CCM.”
It is to be noted that Holcim Ltd and Lafarge SA are worldwide players in the construction sector, whereby Holcim (Mauritius) Ltd is a domestic company in Mauritius and forms part of the Holcim group and Lafarge (Mauritius) Cement Ltd is a domestic company in Mauritius and forms part of the Lafarge group.