PUBLIC VERSION 

IN THE MATTER OF CEMEX, S.A. de C.V. 

DOCKET NO. C-4131 

Federal Trade Commission 

Application for Approval of Divestiture 

Clifford H. Aronson 

Ian G. John 

SKADDEN, ARPS, SLATE, 

MEAGHER & FLOM LLP 

Four Times Square 

New York, New York 10036 

(212) 735-3000 

Attorneys for Cemex, S.A. de C.V. 
TABLE OF CONTENTS 

& 

Introduction ............................................................................................................... 1 

Description of The Acquirer .......................................................................... 2 

A . The Acquirer's Name and Address ..................................................... 2 

B . The Acquirer's Officers .................................................................... 3 

C . Description of Acquirer's Business .................................................... 4 

Description of Proposed Divestiture ............................. ............................ 5 

An Analysis of How the Divestiture Would Affect Competition in the 

Relevant Market and Achieve the Remedial Purposes of the Decision 

and Order ............................. .................................................................... 7 

A . Effects on the Relevant Market ............................................. 7 

B . Achieving the Remedial Purposes of the Order ..................... 8 

Conclusion ............................................................................................................... 10 
INDEX OF EXHIBITS 

Exhibit A: Asset Purchase Agreement and Related Agreements (Confidential) 

Exhibit B: Taiheiyo Annual Report, Financial Statements and Other 

Publicly-Available Information Concerning Its Business 

Exhibit C: Publicly-Available Information Concerning CPC's Business 

Exhibit D: Cemex Documents that Discuss the Divestiture (Confidential) 

Exhibit E: [REDACTED] 
Application for Approval of Divestiture 

Introduction 

Cemex, S.A. de C.V. ("Cemex") submits this application for approval 

of divestiture pursuant to Section 2.41(f) of the Federal Trade Commission's ("FTC" 

or "Commission") Rules of Practice and Procedure, 16 C.F.R. 8 2.41 (2005), and the 

Decision and Order in the above-captioned matter ("Order"). Cemex seeks approval 

for its proposed divestiture of certain RMC Group PLC ("RMC") ready mix concrete 

facilities, along with the other assets identified in Appenhx A of the Order 

(collectively "Ready Mix Concrete Divestiture Assets"), to California Portland 

Cement Company ("CPC"), pursuant to an asset purchase and agreement and related 

agreements, dated May 23,2005 (collectively, "the Asset Purchase Agreement"), 

copies of which are attached hereto as Exhibit A,' 

Cemex's divestiture of the Ready Mix Concrete Divestiture Assets to 

CPC would accomplish the Order's objectives by: (i) ensuring that the number of 

ready mix concrete competitors in the alleged relevant geographic area - metropolitan 

Tucson, Arizona - will remain unaltered following Cemex's acquisition of RMC; and 

1 Pursuant to F.T.C.A. 9 9 6(f), 2 1 (c) (codified as amended at 15 U.S.C.A. 9 9 46(f), 5%-2(c)), 

as well as the applicable provisions of the Freedom of Information Act, 5 U.S.C.A. 4 552, Cemex 

requests that certain of the exhibits attached hereto (the "Confidential Exhibits") be treated by the 

Commission as strictly confidential and not be made available to the public. These materials contain 

c~~dential and sensitive commercial and financial information that neither Cemex nor CPC disclose in 

the or- course of their businesses. The disclosure of such confidential information could cause 

harm to Cemex, CPC andor the Ready Mix Concrete Divestiture Assets. 
(ii) remedying the lessening of competition alleged in the Commission's Complaint. 

See Order f 1I.E. 

As explained in greater detail below, CPC is a particularly suitable 

purchaser for the Ready Mix Concrete Divestiture Assets. It not only is familiar with 

the ready mix business, having operated ready mix assets in other parts of the United 

States, but is also vertically integrated into cement production, with a major 

manufacturing plant located in Arizona, the customers of which are ready mix 

concrete fms located throughout Arizona. [REDACTED] The net result of the 

proposed divestiture is that competition for the production and sale of ready mix 

concrete in the Tucson, Arizona area will remain significant and vigorous following 

the proposed divestiture. 

I. Description of California Portland Cement Company 

A. The Acauirer's Name and Address 

California Portland Cement Company 

2025 East Financial Way 

Suite 2000 

Glendora, California 91 741 -4692 

(626) 852-6200 
B. The Accpirer's Officers 

Pursuant to publicly available information, the following individuals 

serve as CPC's officers: 

Michio Kimwa, Chairman of the Board; 

James A. Repman, President & Chief Executive Officer; 

John H. Renninger, Senior Vice President, General Counsel & 

Secretary; 

James A. Wendoll, Senior Vice President & Chief Financial Officer; 

Robert M. West, General Manager - Ready Mix Division; 

John H. Bennett, Jr., Vice President - Environmental Matters; 

J. Michael Burton, Vice President & Chief Accounting Officer; 

William Klawitter, Vice President - Sales, Catalina Pacific Concrete; 

John D. Clemente, Vice President - Human Resources; 

kck Patton, Senior Vice President - Operations, Cement Division; 

Mary C. Hernandez, Vice President - Communication & Information 

Services; 

Steven A. Regis, Vice President - Engineering Services; and 

Paul Moore, Vice President - Operations, Catalina Pacific Concrete. 

See Exhibit B, infra at n. 2, at 32; see also http:llwww.calportland.corn/ 
C. Description of the Accluirer's Business 

CPC is a wholly-owned (indirect) subsidiary of Taiheiyo Cement 

Corporation ("Taiheiyo"), which is headquartered in Tokyo, ~a~an.~ CPC is

headquartered in Glendora, California and currently manufactures and sells 

aggregates, portland cement and ready mix concrete in the Western United States. In 

addition to a cement plant in Rillito, Arizona, it also operates, among other things, two 

cement plants in California, three cement terminals in California and Nevada, as well 

as nine ready mix concrete sites in California. 

CPC has extensive experience in manufacturing and delivering ready 

mix concrete through its subsidiary, Catalina Pacific Concrete Corporation, 

experience which will be readily transferable to the operations it has agreed to 

purchase fiom Cemex. In California, CPC has a fleet of over 150 ready mix trucks, 

delivering concrete shipments from six facilities in the Los Angeles area and three 

sites in the Orange County region. CPC's concrete facilities are state-of-the-art and 

many of its staff, according to its website, are hlly certified by the American Concrete 

Institute or Concrete Technologists. CPC also readily adheres to National Ready Mix 

Concrete Association standardse3 In addition, CPC sells its cement to a multitude of 

L For more information concerning Talheiyo, see Exhibit B attached hereto, which contains 

copies of Taiheiyo's most recent annual report, recent financial statements, and other publicly-available 

information from its website. 

3 For more iaformation concerning CPC, see Exhibit C attached hereto, which contains 
ready mix concrete firms throughout the Western Untied States, gving it an enormous 

understanding of the business and supply and demand conditions. 

II. Description of the Proposed Divestiture 

In its Complaint, the FTC alleges that the effects of Cemex's 

acquisition of RMC may be to substantially lessen competition and tend to create a 

monopoly in the manufacture and sale of ready mix concrete in Tucson, Arizona in 

violation of Section 7 of the Clayton Act, as amended, 15 U.S.C. $ 18, and Section 5 

of the FTC Act, as amended, 15 U.S.C, 4 45. Complaint 7 16. Cemex agreed to 

resolve the FTC's objections to the consummation of the Acquisition by entering into 

an Agreement Containing Consent Orders, in which it committed to divest the Ready 

Mix Concrete Divestiture Assets to a firm approved by the FTC within six months of 

the Acquisition Date. 

Cemex hereby proposes to divest the Ready Mix Concrete Divestiture 

Assets to CPC in accordance with the Asset Purchase Agreement, which contains a 

complete description of the assets to be di~ested.~ Asmore fully described in 

Schedule A to the Asset Purchase Agreement, Cemex has agreed to sell the following 

assets [REDACTED] : 

publicly-available information from CPC's website. 

4 See Exhibit A. Cemex also attaches at Exhibit D its documents that discuss the divestiture, 

which include correspondence between Cemex and CPC. 
Ready Mix Concrete Facilities 

10200 W. Tangerine Road, Marana, Arizona 85653; 

6601 N. Casa Grande Highway (Orange Grove), Tucson, Arizona 

85743; 

9301 S. Swan Road, Tucson, Arizona 85706; 

11800 E. Valencia Road, Tucson, Arizona 85747; 

409 Camino Ramanote, Rio Rico, Arizona 85648; 

Aggregate Facilities 

6601 N. Casa Grande Highway (Orange Grove), Tucson, Arizona 

85743; 

1 1800 E. Valencia Road, Tucson, Arizona 85747; 

409 Camino Rsunanote, Rio Rico, Arizona 85648; 

Asphalt Concrete Facility 

6601 N. Casa Grande Highway (Orange Grove), Tucson, Arizona 

85743; and 

[REDACTED] 
JII. An Analvsis of How the Divestiture Would Affect Competition in the Relevant 

Market and Achieve the Remedial Purposes of the Decision and Order 

A. Effects on the Relevant Market 

The proposed dwestiture will not adversely affect competition in the 

sale of ready mix concrete in Tucson, Arizona because, upon consummation of the sale 

of the Ready Mix Concrete Divestiture Assets to CPC, there will be the exact same 

number of competitors that existed prior to Cemex's acquisition of RMC. According 

to the Complaint, before the proposed transaction, three firms supplied ready mix 

concrete in Tucson, Arizona. See Complaint, fl 11. By transferring RMC's 

Tucson-area operations to CPC, the proposed divestiture will ensure that at least three 

firms will continue to supply ready mix concrete in the Tucson area. CPC will simply 

replace RMC, and the competitive environment that existed prior to the transaction 

will be maintained. 

Because Cernex plans to transfer all of RMC's Tucson-area ready mix 

concrete assets to CPC and because CPC is currently not in the ready mix concrete 

business in Tucson, neither the Acquisition nor the divestiture will change 

concentration regardless of the metric used. In fact, the divestiture will increase ready 

mix concrete competition in Tucson by allowing CPC to vertically integrate 

downstream and thereby increase the efficiency of its to be acquired Tucson 

operations. At the very least, CPC will be able to reduce the Ready Mix Concrete 
Divestiture Assets' cement acquisition transaction costs. These savings should allow 

CPC to enhance output of the Ready Mix Concrete Divestiture Assets. CPC's history 

of success in the ready mix concrete industry as well as its general familiarity with the 

Tucson ready mix concrete marketplace will enable it to be a highly effective 

competitor fkam the moment it acquires the Ready Mix Concrete Divestiture Assets. 

B. Acluevinn the Remedial Pumoses of the Order 

The remedial purposes of the Order are: (i) "to ensure the[] continued 

operation [of the Ready Mix Concrete Divestiture Assets] in the same manner and 

engaged in the same businesses in which the RMC Ready Mix Concrete Businesses 

were engaged as of the time of the announcement of the Acquisition;" and (ii) "to 

remedy the lessening of competition resulting from the Acquisition as alleged in the 

Commission's Complaint." Order 7 KE. The proposed divestiture will satisfy both 

purposes. 

By putting the Ready Mix Concrete Divestiture Assets in the hands of 

an independent owner with the resources and expertise to maintain it as an ongoing, 

effective competitor, the proposed divestiture will restore any actual or potential 

competition that allegedly would have been lost but for the divestiture. Three hs 

existed prior to the acquisition and, if approved, three firms will exist after the 

proposed divestiture. "The competitive environment that existed prior to the 

acquisition is maintained," thereby satisfjmg the criterion the Commission noted in its 

8 
Analysis of Agreement Containing Consent Orders to Aid Public Comment. As noted 

above, the divestiture would not change concentration in the relevant market. 

CPC is uniquely qualified to acquire and maintain (and probably 

increase) the competitiveness of the Ready Mix Concrete Divestiture Assets. 

[REDACTED]~ As a result, CPC should be able to make the ownership transfer 

seamless for the Ready Mix Concrete Divestiture Assets' employees and customers. 

(CPC will shortly be making its own submission, including a codidential business 

plan, in support of this application.) 

5 [REDACTED] 
Conclusion 

Because the proposed divestiture of the Ready Mix Concrete 

Divestiture Assets to CPC is procompetitive, in the public interest and accomplishes 

the stated goals of the Order, Cemex respectfully petitions the Commission for 

approval to sell the Ready Mix Concrete Divestiture Assets to CPC. 

Dated: June 7,2005 Respectfblly submitted, 

Clifford H. Aronson 

Ian G. John 

SKADDEN, ARPS, SLATE, 

MEAGHER & FLOM LLP 

Four Times Square 

New York, New York 10036 

(212) 735-3000 

Attorneys for Cemex, S.A. de C.V.