FRENCH materials giant Lafarge could be forced to sell various Redland ready-mixed concrete operations when it takes control of the UK aggregates and tiles group.
Trade and industry minister John Battle shocked the City last week when he called on the European Commission to allow the Office of Fair Trading to look into Lafarge's proposed acquisition of Redland.
Concerns are thought to centre on the high market share Lafarge will enjoy in the ready-mixed concrete markets in the Midlands and around Norwich following the takeover.
Lafarge captured a significant slice of the local market when it acquired the Midlands and East Anglian quarrying group Ennemix last year. Redland is also a major producer in the area and has a superquarry in the region.
Lafarge, which is France's largest cement-maker and a major plasterboard producer in the UK, won agreement from the Redland board for a takeover after it raised its offer for shares in the materials group from 320p to 345p. The deal values Redland at £1.8 billion.
The possible referral is not expected to stop the takeover and the acquisition is expected to win shareholder approval in the coming weeks.
Bertrand Collomb, chairman of the French group, said: 'the agreement clears the way for the creation of a world-class company.'
The takeover marks the end of a grim period for Redland, which has been burdened by the £1 billion it paid for brickmaker Steetley and the downturn in the German roof tile market.
The takeover is expected to lead to the departure of Redland chief executive Robert Napier and group finance director Paul Hewitt.
The deal makes Lafarge a significant force in the UK. In addition to the 15 per cent to 20 per cent of the UK plasterboard market it holds, it will rank as Europe's largest concrete roof tile producer and a major force in the UK aggregates and ready mixed concrete markets.
Its arrival could jeopardise some UK cement makers' key markets as it may source cement from its own plant in France.