REG - Competition and Mkts - Merger Update: Hanson/ Mick George

Heidelberg Materials AGAnnouncement

24/11/2023 08:15

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RNS Number : 5342U  Competition and Markets Authority  24 November 2023

 

FOR IMMEDIATE RELEASE: 07:00AM FRIDAY 24 NOVEMBER 2023 

 Construction materials deal could curb competition in parts of England

Hanson's proposed purchase of Mick George Limited could result in less choice
and higher prices for building contractors

 

Following a phase 1 Investigation, the Competition and Markets Authority (CMA)
has provisionally found that the proposed purchase of Mick George Limited
(MGL) by Hanson Quarry Products Europe Limited (Hanson) raises competition
concerns in certain markets for building materials in East of England and the
East Midlands.

 

Hanson, which is wholly owned by Heidelberg, a multinational building
materials company, is one of the UK's leading producers and distributors of
construction materials, with production facilities and customers throughout
the UK. MGL is one of the leading suppliers to the construction industry in
the East of England and East Midlands.

 

Both Hanson and MGL supply aggregates, which are widely used in the
construction of roads, buildings, and other infrastructure in the UK. The two
businesses also supply ready-mixed concrete - manufactured by mixing
aggregates with specific quantities of cement and other additives - which is
also an important material used in the construction sector.

 

After investigating the deal, the CMA found it gives rise to competition
concerns in relation to the supply of non-specialist aggregates or ready-mix
concrete in eighteen local markets in the East of England and the East
Midlands.

 

In each of these local markets, the two businesses currently have a large,
combined presence, with limited competition from other suppliers. The CMA is
therefore concerned that the deal could result in limited choice for local
customers, leading to higher prices and lower quality products for contractors
working in these areas.

 

Colin Raftery, CMA Senior Director for Mergers said:

 

"These products are an important input for building projects, so a loss of
competition between two of the main suppliers could result in increased
construction costs for businesses and public bodies.

 

"In many areas where both businesses are active, sufficient competition will
remain. But in some local markets, where there are not enough strong
alternatives to the merging business, the deal could limit customer choice.

 

"Unless the companies put forward a solution, we will need to take a deeper
look into the potential impact of reduced competition in these local areas."

 

Hanson and MGL now have five working days to address the CMA's concerns. If
they are unable to do so, the merger will be referred for an in-depth phase 2
investigation.

 

For more information, visit the Hanson / Mick George merger inquiry case
page. (https://www.gov.uk/cma-cases/hanson-slash-mick-george-merger-inquiry)
 

 

 

Notes to editors:

1.         The CMA's formal phase 1 merger investigation began on 19
September 2023. The statutory 40 working day deadline for the phase 1 decision
was extended when MGL failed to provide the required documents and information
by the deadline required by a formal notice from the CMA.

2.         The CMA found concerns relating to eleven aggregates sites
located in the following geographic areas:

a.         Cambridgeshire (Needingworth, Haddenham, Waterbeach, Mepal,
Sutton Gault, Crimplesham).

b.         Northamptonshire (Ringstead, Earls Barton, Great
Billing).

c.         Suffolk (Worlington).

d.         Norfolk (Watlington).

3.         The CMA found concerns relating to seven ready-mixed
concrete sites located in the following areas:

a.         Cambridgeshire (Ely, St Ives)

b.         Leicestershire (Husbands Bosworth, Market Harborough)

c.         Northamptonshire (Northampton, Burton Latimer,
Wellingborough

4.         The CMA is the UK's primary competition and consumer
authority. It is an independent non-ministerial government department with
responsibility for conducting investigations into mergers, markets and the
regulated industries and enforcing competition and consumer law. For CMA
updates, follow us on Twitter, Facebook, and LinkedIn. 

5.         All media enquiries should be directed to the CMA press
office by email on press@cma.gov.uk (mailto:press@cma.gov.uk)  or by phone
on 020 3738 6460. 

 

 

 

 

 

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