Cheung Kong Infrastructure Holdings (CKI), controlled by tycoon Li Ka-shing, said it will merge its concrete unit Anderson Asia (Holdings) Limited with the Hong Kong arm of Hanson PLC.
The merger will create the largest quarrying firm and concrete producer in Hong Kong, with over one-third market share. The deal should be completed by the second quarter of this year, the company said in a statement.
CKI said the partnership will be run on a 50-50 basis, and that the merged entity will continue to carry on a long-term contract with Green Island Cement, another unit of CKI.
"The challenges in Hong Kong’s property and construction markets have affected the price and volume of infrastructure materials in recent years," said Lambert Leung, chief executive officer of CKI Materials.
He said the merger would increase the efficiency in the production of infrastructure materials.