ATHENS Swiss cement producer Holcim's HOLN.VX plans to merge with French peer Lafarge LAFP.PA and create the world's biggest cement maker will be subject to an extensive review, the European Union's antitrust chief said on Thursday.
Holcim and Lafarge, the top two in the cement industry, unveiled the biggest tie-up in the sector last week, which will help the combined company slash costs, trim debt and better cope with soaring energy prices, tougher competition and weaker demand.
The size of the merger requires a lengthy examination before it can be approved, European Competition Commissioner Joaquin Almunia told reporters on the sidelines of a conference organized by the Hellenic Competition Authority in Athens.
If approved, the combined group would be worth just under $60 billion.
"Last week the parties informed us of their intention but with very general information before the operation was known by the media. Now we will receive more detailed information because this should of course be analyzed at our level," Almunia said.
"Given the size of the two companies, given that they are the two main players in the European market, yes, it's clearly a phase 2 analysis," Almunia said, referring to a review that could take several months.
A preliminary review by the European Commission takes 25 working days. The EU competition watchdog typically opens a phase 2 investigation of up to four months if it has serious concerns that a deal may harm consumers and rivals.
The deal needs regulatory approval in 15 countries.
(Reporting by Foo Yun Chee; Editing by Erica Billingham)