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Competition watchdog clears Barro-Adelaide Brighton acquisition

The ACCC has concluded an investigation into Barro Group’s acquisition of a 43 per cent stake in Adelaide Brighton after examining its impact on Australia’s cement, concrete and aggregates markets.

In October, the Australian Competition and Consumer Commission (ACCC) announced it would assess a 43 per cent stake Barro Group (and its related entities) had acquired in ASX-listed Adelaide Brighton through a series of share purchases.

According to the ACCC, it was keen to investigate the completed acquisition because the two vertically integrated companies have overlap in the market for the supply of cement, pre-mixed concrete and aggregates.

The investigation focused on the competition impacts on the pre-mixed concrete and aggregates markets in Melbourne, Brisbane and Townsville, where Barro and Adelaide Brighton’s operations overlap.

ACCC Commissioner Stephen Ridgeway.

Barro also did not seek informal merger clearance from the ACCC prior to acquiring the stake in Adelaide Brighton.

The ACCC found Barro and Adelaide Brighton will continue to face competition from Boral, Holcim and Hanson, which are all three large vertically integrated competitors with national operations. A number of smaller independent companies would also continue to provide competition.

“On the basis of the information we have available to us, Barro’s stake in Adelaide Brighton will not substantially lessen competition,” ACCC Commissioner Stephen Ridgeway said. “Major rival cement, aggregates and pre-mixed concrete suppliers will continue to provide competition.”

The ACCC may reopen its investigation if it receives further information that alters its current conclusions.

Barro Group is a family-owned construction materials supplier and distributor with operations in Victoria and Queensland. Its operations include the supply of pre-mixed concrete, quarry materials, cement, builders’ supplies, concrete roof tiles and concrete precast panels. Barro Group’s main pre-mixed concrete brand in Victoria is the “Pronto” brand.

Adelaide Brighton is an ASX-listed manufacturer and supplier of a range of products to the building, construction, infrastructure and mineral processing markets across Australia. Adelaide Brighton’s operations include the supply of clinker, cement, industrial lime, pre-mixed concrete, quarry materials, cement and concrete products. Adelaide Brighton supplies the “Hytec” pre-mixed concrete brand.

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