OFT accepts undertakings instead of reference to the Competition Commission

2/07 3 January 2007

The OFT has decided to accept undertakings offered by Aggregate Industries Limited, which address the competition concerns regarding the supply of asphalt in three local areas - all in the South East of England - which arose from the completed acquisition by Aggregate Industries Limited of Foster Yeoman Limited. This transaction will not now be referred to the Competition Commission.

Vincent Smith, Senior Director for Competition at the OFT, said

'We are confident that the undertakings offered involving the divestment of two asphalt plants and the Foster Yeoman share of an asphalt producing joint venture and will address our concerns set out in our decision of 20 November.'

NOTES

1. The Reference Test - the OFT has a duty to make a reference to the Competition Commission if the OFT believes that it is or may be the case that a relevant merger situation has been created; and the creation of that situation has resulted, or may be expected to result, in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.

2. Under the Enterprise Act 2002 a relevant merger situation is created if two or more enterprises have ceased to be distinct enterprises; and the value of the turnover in the United Kingdom of the enterprise being taken over exceeds £70 million; or as a result of the transaction, in relation to the supply of goods or services of any description, a 25 per cent share of supply in the UK (or a substantial part thereof) is created or enhanced.

3. Under section 73 of the Enterprise Act 2002 the OFT may, instead of making a reference, and for the purpose of remedying, mitigating or preventing the substantial lessening of competition concerned, or any adverse effect which has or may have resulted from it or may be expected to result from it, accept from such of the parties concerned as it considers appropriate undertakings to take such action as it considers appropriate. In doing so, the OFT will have regard to the need to achieve as comprehensive a solution as is reasonable and practicable to the substantial lessening of competition and any adverse effects resulting from it.

4. Before accepting any such undertakings the OFT shall give notice of the proposed undertakings under Schedule 10 of the Enterprise Act 2002, and considered any representations made in accordance with that notice.

5. The text of this decision is available in the mergers section.

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