Boral chief, Mike Kane, has warned of plant closures and land sales if a proposed merger with CSR is blocked.

Boral announced plans to merge its east coast brick business with rival CSR in April in order to boost profitability in what has become a dying industry.

The Australian Competition and Consumer Commission has cast doubt over the joint venture, raising competition issues.

The Age reported that at the building and construction group’s general meeting on 6 November, Mr Kane said that the ACCC’s issue paper was “concerning.”

“We are in the fortunate position where the high price of land in Australian eastern metropolitan markets means that value will eventually be delivered for Boral shareholders if an ultimate exit over time is the only remaining option,” Mr Kane said.

Citi analyst Simon Thackray was also quoted in the same article as saying that the brick industry was challenged by both competition issues and high fixed costs.

“It’s fair to say that the land can be more valuable than the actual manufacturing plant,” Mr Thackray said.

“A joint venture that rationalises the manufacturing base makes total sense. Does it make the consumer worse off? I doubt it.”

Mr Kane and ACCC chairman Rod Sims will meet this week to discuss the issues paper. The ACCC plans to have a final decision on 18 December.