You are using an older browser version. Please use a supported version for the best MSN experience.

Fletcher Building cleared to buy Higgins

NZ NewswireNZ Newswire 7/07/2016

Fletcher Building has been given the green light to buy Higgins Group Holdings.

The Commerce Commission has cleared the merger, which covers Higgins' road surfacing and road maintenance, civil structure and construction products, including most of its aggregates and bitumen businesses.

Higgins hasn't sold its ready mix concrete business and property businesses, which will be transferred to existing Higgins shareholders prior to the acquisition.

Commerce Commission chairman Mark Berry said the regulator is satisfied the merger won't have the effect of substantially lessening competition in the supply of aggregates in markets where Fletcher - operating as Winstones - and Higgins overlap.

Specifically, the commission looked at whether the loss of Higgins quarry operations in north Waikato, Napier, Manawatu-Whanganui, Kapiti and Christchurch would make it easier for Fletcher to raise prices to external aggregate customers such as roading contractors.

"Higgins and Fletcher Building are key competitors of aggregate products in particular regions. However, we consider that strong competition would continue in these regions from existing competitors and the ability of customers to self-supply," Dr Berry said.

Fletcher had originally also applied for clearance to acquire Horokiwi Quarries Limited in Wellington, but it dropped that part of its application last week.

Fletcher said in February that it would pay $315 million for Higgins, New Zealand's third-largest road construction and maintenance company, subject to regulatory approval.

image beaconimage beaconimage beacon