- The Australian Competition and Consumer Commission (ACCC) will investigate Barro Group’s 43 per cent interest in Australia’s largest cement group, Adelaide Brighton
- The consumer watchdog said it has concerns on whether the major stakeholding has an impact on competition between the two companies both operating in the construction materials market
- Adelaide Brighton claimed today that it established a governance framework for this relationship back in 2005 and last disclosed it earlier this year in March
- Shares in Adelaide Brighton opened at $3.04 on the Australian Market and have since seen a 1.16 per cent increase to trade at $3.07
The Australian Competition and Consumer Commission (ACCC) will investigate Barro Group’s 43 per cent stake in cement maker Adelaide Brighton.
The ACCC has its concerns on whether the large stakeholding is having an impact on competition between the two companies both operating in the construction materials market.
The consumer watchdog will also be looking into companies Pronto Concrete and Geelong Premixed Concrete, which are both owned by Australia’s biggest cement group: Adelaide Brighton.
Barro Group first began its investments into Adelaide Brighton over 21 years ago, and has worked its way up to the 43 per cent holding which it has held since September last year.
Adelaide Brighton delivered a media release today to address shareholders and punters alike.
“Adelaide Brighton considers that the products and locations in which it and Barro Group do compete are limited, with the businesses having largely complementary geographic footprints,” a statement read.
The cement king said today that it established a governance framework in 2005 for this relationship with Barro, claiming it was last disclosed back in March this year.
At the forefront of the ACCC’s concerns with Barro being a shareholder is the relationship’s impact on prices and service quality.
Barro Group has done more than being a shareholder as well, as it was previously a partner with customers of Adelaide Brighton products. Barro Group also has three representatives on the Brighton Board — including the role of Chairman.
Adelaide Brighton has said it will cooperate with the ACCC during this process.
Shares in Adelaide Brighton opened at $3.04 on the Australian Market this morning and have since seen a 1.16 per cent increase to trade at $3.07.