The Competition Commission has demanded that Lafarge Tarmac sells off one of its huge cement plants, just months after the regulator approved the company’s creation.
Martin Cave, who has led the commission’s inquiry into construction’s “glue”, is looking to tempt another big player into a market dominated by Lafarge Tarmac, Hanson UK and Cemex.
Anglo American merged its Tarmac business with Lafarge’s UK operations in January after it had received regulatory approval for the deal, although they were forced to sell some assets to Lakshmi Mittal’s investment vehicle. Cave warned in May that concentrating so much power in so few hands was costing the construction industry £36 million a year, and warned that one of the big three would need to offload assets.
Cave today confirmed that Lafarge Tarmac would have to choose whether to keep the Cauldon cement works in Staffordshire or Tunstead in Derbyshire.
“The best way to disturb the balance of a market where producers have focused on retaining their respective market shares rather than competing is to create the opportunity for a major new entrant,” Cave said.
