Brazilian Cement Producers Face Divestment

Fresh on the heels of the recent news regarding the pending merger of cement producers Lafarge and Holcim (as well as the potential for a long delay in completing the merger due to anti-trust regulators), comes news from Brazil regarding an anti-trust decision.

Brazil’s anti-trust regulator, Conselho Administrativo de Defesa Econômica (CADE), has announced proposed sanctions against six cement producers that account for 90% of the Brazilian cement market.   The proposed sanctions, based on an investigation stretching over nearly a decade, include the divestment of nearly 1/4th of the production capacity in the country, in addition to nearly $1.4 billion in fines.   The six firms accused of collusion are likely to battle the decision in the Brazilian courts. The news is sure to affect a market that has been very heated over the past decade, fueled in part by construction activities for the 2016 Olympics and 2014 World Cup.  



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