Tribunal of CADE unconditionally clears CSN Cimentos' acquisition of LafargeHolcim

This past Wednesday (17 Aug), the Administrative Council for Economic Defence (CADE) heard the case of CSN Cimentos' full acquisition of LafargeHolcim Brasil. The Tribunal unanimously decided to clear the transaction unconditionally.

CSN Cimentos is a company wholly owned by Companhia Siderúrgica Nacional (CSN)–a group that operates throughout the steel supply chain–from mining iron ore to its production and trade. The company also works in the cement supply chain through a milling plant in Volta Redonda (state of Rio de Janeiro) and a factory in Arcos (state of Minas Gerais).

LafargeHolcim Brasil, currently controlled by Grupo Holcim, is a company that has branches across 70 countries and operates mainly in the production of cement, concrete, and construction aggregates.

According to CSN Cimentos, the merger is part of a strategy to expand its cement business and reach other areas of Brazil, taking advantage of the country's recovering consumption of iron.

To Grupo Holcim, the transaction represents a business divestment that will strengthen its balance sheet abroad, significantly reducing its debt and allowing for investments in different undertakings.

The companies notified CADE about the transaction in 2021. In March 2022, the body's investigative arm (the Office of the Superintendent General) cleared the acquisition unconditionally. However, after an appeal lodged by an interested party, Cimento Tupi S.A., the case was remitted to the authority's Tribunal, where Commissioner Luis Braido was assigned its rapporteur.

In his vote, Mr Braido stressed the merger does not raise relevant competition concerns as the market tests showed other companies exerted sufficient levels of rivalry and competitive pressure.

Access Case no. 08700.006299/2021-63.