Brazil may approve Camargo's Cimpor stake – report

Brazil may approve Camargo's Cimpor stake – report
21 May 2012

Brazil's antitrust regulator Cade may approve Camargo Correa's stake in Portuguese cement maker Cimpor Cimpor but reject the stake of rival Votorantim Cimentos, according to reports by newspaper Valor Economico.

Cade has been analysing Votorantim and Camargo Correa's separate purchases of minority stakes in Cimpor since February 2010, which frustrated an acquisition attempt by Brazilian steelmaker CSN. Camargo Correa has raised its stake since then to nearly 33 percent of Cimpor.

Camargo Correa launched a EUR2.5bn bid for the rest of Cimpor in March at 5.5 euros per share, in a bid defended by the Portuguese government.

The newspaper report on Friday, citing findings by a prosecutor at regulator Cade, reinforces expectations that Votorantim may have to sell some of its Brazilian cement assets to reduce its market concentration. The conglomerate's market share is nearly 40 per cent nationally, but almost 90 per cent in some regions.

Camargo Correa's buyout of Cimpor could help competition in Brazil by reducing Votorantim's market share, Cade chief Olavo Chinaglia told Reuters last month.

Approval of Camargo Correa's 2010 purchase may depend on certain conditions, such as selling assets in some markets and avoiding participation in other cement companies, the paper said, citing access to the prosecutor's report. (Source: Reuters)

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