The Australian Competition and Consumer Commission is finding issue with the proposed clay brick joint venture between CSR Limited (ASX:CSR)
and Boral Limited (ASX:BLD)
CSR and Boral both supply a range of building products to the construction industry and propose a joint venture for the manufacture and supply of clay bricks in eastern Australia.
The ACCC says that the JV would reduce the number of major suppliers in the east from three to two and the resulting duopoly would likely lead to an increase in the price of clay bricks and a reduction in the product range to smaller consumers.
The ACCC has undertaken extensive market enquiries regarding the joint venture with the parties supplying considerable information. The ACCC will now undergo an assessment on what would happen in the market if the joint venture did not go ahead and invites submissions before a final decision on 18th December 2014.
CSR Limited reported a net profit of $99.1 million for the full year ended 30 June 2014.