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Tarmac tie-up with Lafarge planned

Tarmac owner Anglo American and France’s Lafarge have unveiled plans to move their cement, aggregates, ready-mixed concrete and asphalt operations into a new UK joint venture.

The two businesses recorded combined sales of £1.8bn in 2010 and are expected to generate cost savings of at least £60M a year from the proposed tie-up, which is subject to regulatory approval.

Lafarge entered the UK market in 1987 before acquiring Redland in 1997 and Blue Circle in 2001. It employs 2,800 people in the UK and supplies around 50% of the cement market.

Tarmac is the UK’s largest quarrying company and has been involved in some of the UK’s biggest construction projects including Wembley Stadium, Emirates Stadium, the M1 widening, M25 resurfacing and the London Olympics. It employs 4,500 people in the UK and has a portfolio including 118 quarries, 69 asphalt plants and 180 ready-mixed concrete sites.

The companies said the combination will create greater value for their customers, given the bigger offer of products and services.

Anglo American said it expected any job losses from the tie-up to be minimal.

The joint venture will operate with its own board of directors and will be led by an independent chairman and executive management teams drawn from both businesses.

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