By Kristy Dorsey

Breedon Group has offered to sell off some assets, including three sites in Scotland, to smooth concerns that its acquisition of Cemex operations in the UK could lead to higher prices for building materials in certain local markets.

Headquartered in Derbyshire, Breedon paid £178 million earlier this year to take over approximately 100 sites from Cemex, which has cement, quarrying and asphalt facilities in Scotland employing about 150 people. Breedon employs about 700 of its 3,000 staff in Scotland across a range of quarries, asphalt and concrete plants.

Last month, the Competition and Markets Authority (CMA) said it was concerned the deal could lead to higher prices and lower quality products in 15 local markets across the UK, including the east of Scotland. It then gave Breedon five working days to address these concerns, or otherwise be referred for an in-depth Phase 2 investigation.

In response, Breedon proposes to sell off a “small number” of ready-mixed concrete plants and an asphalt plant in England, along with two quarries and a cement terminal in Scotland. The exact sites have not been disclosed.

In a short statement yesterday, the competition watchdog said: “The CMA considers that there are reasonable grounds for believing that the undertakings offered by Breedon Group, or a modified version of them, might be accepted by the CMA under the Enterprise Act 2002.”

A spokesperson for Breedon said a final decision from the CMA is expected by November 5. Breedon has welcomed the watchdog’s initial findings.

“The company fully expects to be able to finalise the required undertakings to the CMA’s satisfaction and complete the required divestments in the near future, paving the way for the integration of the remaining former Cemex assets into the group later this year,” Breedon said.

“Until that time they will continue to be held separate from Breedon and operated as Pinnacle Construction Materials.”

The acquisition was first announced in January and was completed on July 31. The assets have been in a separate holding while the CMA investigation takes place.

The former Cemex sites in Scotland that are changing hands include ready-mix cement operations in Stirling, Grangemouth, Glasgow and Cumbernauld; quarries in Edinburgh, Fife and Stirlingshire; and asphalt sites in Leith, Kilbarchan in Renfrewshire, and Cowieslinn in the Borders.

In Scotland, Breedon Group operates two cement plants and multiple quarries, asphalt and ready-mix concrete plants.

It also has slate production sites, concrete and clay manufacturing, contract surfacing and highway maintenance operations.