Brazil’s competition authority CADE has approved Camargo Correa’s purchase of a controlling stake in Portuguese cement producer Cimpor, subject to several conditions.
The main condition set by the regulator is that Votorantim, Camargo’s competitor on the Brazilian market, sells its stake in Cimpor. Votorantim and Camargo Correa both bought shares in Cimpor in 2010. Through their shareholdings in Cimpor, both Camargo Correa and Votorantim increased their share of Brazil's market.
Cade also said that Camargo must sell some assets in Brazil’s Sao Paulo state and create a technological development program.
The Cade decision is expected to result in an agreement between Camargo Correa and Votorantim whereby Camargo Correa gets Cimpor assets in Brazil and Votorantim gets Cimpor assets abroad including Spain, Turkey, China and India.
Under the terms of the Cade decision, Votorantim's exit from Cimpor will be carried out either by selling its Cimpor stock back to Lafarge or by a sale to third party, according to Alessandro Octaviani Luis, the Cade board member who wrote the decision.
"We take Votorantim's willingness to negotiate its departure from Cimpor as a symbol of good will to Cade," said Vinicius de Carvalho, Cade's president. (Source: Reuters).
