MANILA - The Philippine Competition Commission (PCC) on Saturday said it would further review San Miguel Corporation's (SMC) acquisition of Holcim Philippines, saying the deal could lead to a "cartel-like coordination among cement firms" in several regions.
PCC ended its 30-day review of the deal last month, but decided to proceed with Phase 2 for "a more detailed analysis of the transaction is required using additional information from the parties and stakeholders," the commission said in a statement.
"The Phase 2 review will also assess whether there will be an increased likelihood of cartel-like coordination among cement firms operating in the identified geographic areas," it read.
According to the PCC's initial review, market concentration of grey cement, clinker, ready-mix-concrete, and aggregates may be affected in the following regions:
- Cordillera Administrative Region
- Central Luzon
- National Capital Region
- Northern Mindanao
- Bangsamoro Autonomous Region in Muslim Mindanao
- Davao del Norte
"Cement is a commodity with low product differentiation where brands undergo the same quality standards," the antitrust body said.
"While the transaction is national in scope, the initial review shows that geographic markets by region affect retailers and consumers differently in terms of production, distribution and price," it said.
The Ramon Ang-led company acquired 85.7 percent of Holcim Philippines for $2.15 billion in May 2019, after the Swiss cement manufacturer decided to reduce its stakes in Southeast Asia.
SMC, through its First Stronghold Cement Industries Inc. subsidiary, also has stakes in other cement manufacturing firms like Northern Cement Corporation, Oro Cemento and Eagle Cement, the agency noted.