Outlook: French get a sense of deja vu
Friday 28 November 1997
If the French have any sense of irony, then Lafarge cannot fail to smile at the unexpected attempt by the UK competition authorities to wrest back from Brussels the responsibility for vetting one tiny detail of its Redland takeover.
Five years ago when Redland was stalking Steetley (the acquisition, incidentally, that began its downfall) the UK authorities intervened in a similar fashion.
In an attempt to fight off the aggressor, Steetley agreed to merge its building materials business with those of Tarmac. The UK authorities persuaded Brussels that they were the relevant competition authority to examine the deal and promptly blocked it, allowing Redland-Steetley to sail through the Brussels competition authorities unopposed.
The Industry Minister John Battle has now decided that Lafarge-Redland merits the once over by the Office of Fair Trading because it will give the combined group a stranglehold over the ready mixed concrete markets in Leicester and Norwich.
These are what are known in the parlance of the anti-trust busters as distinct markets.
It is hard to see this being a showstopper, however. The local monopoly arises only because Lafarge acquired a small aggregates business, Ennemix, last year for pounds 8m from under Redland's nose.
Presumably it would have no hesitation in disposing of the business to gain regulatory clearance.
Approval in Europe, however, could prove more complicated because the combined business would emerge with 18 per cent of the French aggregates market.
The French themselves are probably not bothered, even if it means hefty job losses in France. That means Brussels will probably not get too excited either.
But what a reversal of fortunes it would if Larfarge were given the green light in Britain but not in Europe. Admittedly, it looks unlikely turn of events but stranger things have happened at sea.
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