Breedon agrees a £16.5 million deal with Tarmac for 4 quarries and an asphalt plant
Breedon, the UK’s largest independent construction materials group, has agreed to acquire from Tarmac – a CRH company – four quarries and an asphalt plant for a total consideration of £16.5 million, to be satisfied by the transfer to Tarmac of 27 of Breedon’s ready-mixed concrete plants and a payment of £4.9 million in cash.
The deal is conditional on approval by the Competition & Markets Authority (CMA).
The operations to be acquired by Breedon comprise quarries in Scotland, Cumbria and North Wales, together with a quarry and asphalt plant in West Wales. The ready-mixed concrete plants to be divested by Breedon are in multiple locations extending from Dumfries in Scotland to Exeter in Devon.
The deal is in line with Breedon’s strategy of expanding its aggregates portfolio, in this case adding approximately 25 million tonnes to the Group’s mineral reserves and resources, and furthering the development of its asphalt capacity. It also streamlines Breedon’s readymix network. The transaction is not expected to have a material impact on the Group’s earnings.
Pat Ward, Breedon’s Group Chief Executive, commented: “This deal brings significant benefits: it adds to our reserve base; it is margin-enhancing; it releases value from peripheral readymix plants; and it will enable us to replace third-party aggregates providers with our own sources of supply.
“It is also a great example of how we can work with our larger peers – in this case CRH, one of the world’s most successful global building materials companies – to benefit customers and other stakeholders on both sides.”
The transaction is expected to close in the first half of 2018, subject to approval by the CMA.