CSR and Brickworks cleared to merge NZ businesses

Thursday 11th October 2012

CSR and Brickworks are being allowed to merge their New Zealand brick businesses because the Commerce Commission took the view that competition exists from the threat of new entrants and other forms of cladding.

The merger reduces the number of major clay brick suppliers in New Zealand to two from three.

Commerce Commission chairman Mark Berry said the commission was satisfied that the proposed joint venture was unlikely to substantially lessen competition in the New Zealand market for manufacture, import and supply of clay bricks.

CSR NZ is owned by CSR Australia and Brickworks NZ is owned by Australian based Brickworks. CSR's brick manufacturing plant in New Lynn is not included in the proposed merger.

Their main competitor in New Zealand is Midland Brick, a distributor of products for Australia's Boral.

The applicants argued that brick was only one of a number of choices for exterior cladding.

James Hardie supplies fibre cement, Fletcher Building supplies concrete brick and block, and fibre cement and Carter Holt Harvey supplies timber weatherboard.

Boral was expected to compete aggressively in New Zealand and there were a number of Australian and Asian-based brick manufacturers that could supply New Zealand, it was argued.

BusinessDesk.co.nz

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