Boral Ltd said Friday it has withdrawn an undertaking to Australia’s competition watchdog that the company won’t proceed with a A$$862 million takeover bid for rival Adelaide Brighton Ltd.
As a result, Boral expects the Australian Competition and Consumer Commission to take legal action in the Federal Court to stop the bid, the company said in a statement.
Boral has proposed a cooperative approach with the ACCC to seek an early resolution of the competition issues involved, which led the regulator to knock back the bid.
Boral disagrees with the ACCC’s ruling that the takeover would result in a substantial lessening of competition in markets for the supply of cement and clinker, fly-ash, aggregates, concrete and concrete masonry products in Australia.
After completing an extensive review of the competition issues last year and the ACCC’s arguments, Boral remains confident that the takeover won’t lessen competition.
"We remain confident that Boral’s takeover of Adelaide Brighton would not substantially reduce competition or disadvantage consumers," Managing Director Rod Pearse said in a statement.
"The proposed acquisition of Adelaide Brighton is consistent with Boral’s strategy of growing our core building and construction materials assets in Australia and offshore," he said.
"It would allow us to develop the scale required to ensure the Australian cement and lime industries remain efficient by international standards," Pearse added.
He warned that a lengthy court case may be on the cards.