Citing concerns over a potential lack of competition, the European Commission (EC) recently prohibited a planned takeover of Cemex Croatia by HeidelbergCement and Schwenk joint venture company Duna Dráva Cement (DDC).

According to the EC’s investigation of the transaction, DDC, bolstered by Cemex Croatia’s cement plants, would control a share of between 45 percent and 50 percent of the Croatian market, a figure that would top 70 percent in some regions of the country, like Dalmatia. The investigation also found that in DCC's other efforts to increase market share in Croatia, it had been offering more competitive pricing over the past few years, which it would presumably stop doing if the merger went through.

"We had clear evidence that this takeover would have led to price increases in Croatia, which could have adversely affected the construction sector,” Commissioner Margrethe Vestager, who leads the EC’s efforts on competition policy, said in an announcement. “HeidelbergCement and Schwenk failed to offer appropriate remedies to address these concerns. Therefore, the Commission has decided to prohibit the takeover to protect competitive markets for Croatian customers and businesses. We will continue enforcing competition rules equally across the European Union, no matter where companies are based."

To mitigate concerns over loss of competition, HeidelbergCement and Schwenk proposed remedies such as granting competitors access to a cement terminal in Metković currently operated by Cemex. The commission found this inadequate to guarantee fair competition.