Brussels, 19/04/2001 (Agence Europe) - The European Commission has decided to initiate an in-depth investigation into a planned acquisition of Addtek International Oy Ab, whose headquarters is in Finland, by CRH Plc. The two companies are active in the same sectors.
Based in Ireland, CRH manufactures and distributes building materials (such as cement, aggregates and ready-mixed concrete) as well as precast concrete products for the construction sector. It is present in the Finnish building materials market via two subsidiaries: Finnsementti Oy (grey cement), on the one hand, and Lohja Rudus Oy (aggregates and ready-mixed concrete), on the other, as well as on the Dutch construction flooring market via its other subsidiary Dycore BV.
The largest manufacturer of precast concrete products in Europe, Addtek is active in the Finnish market of precast concrete products via Parma Betolinal Oy, which it jointly controls with the Heidelberger group and on the Ducth construction flooring market via its subsidiaries Verenigde Bouwproducten Industrie BV and Spanbeton BV.
The Commission's preliminary investigation demonstrated, notably, that the accumulated market share of the parties in the prefabricated concrete flooring market in the Netherlands would raise competition concerns, especially as their closest competitors are significantly smaller than the resulting merged entity, and more especially for hollow-core floor elements. In addition, in Finland, CRH is the only producer of grey cement via Finnsementti Oy. In this same country, Parma Betonila Oy, Addtek subsidiary, has a very high market share in precast concrete floors and is, by far, the largest producer of precast concrete structures, both big users of grey cement. At the end of the operation, the new entity would thus largely control the grey cement supplies in Finland, while at the same time have a strong position in precast concrete floors and structures. These elements fuel the doubts of the Commission as to te serious problems of competition, essentially on the Dutch and Finnish markets. A large number of clients and competitors, especially SMEs, have, moreover, said that they were very concerned by theoperation notified, which could mean price increases for consumers in a certain number of products in the two countries in question, especially prefabricated concrete floors. The Commission should pass down its verdict at latest in four months.