Deal offers 鈥渆xcellent opportunities for expansion鈥� says Leicestershire firm
Breedon has snapped up Northern Ireland-based materials manufacturer Lagan Group for 拢455m.
Leicestershire-based Breedon had revealed in February it was in talks to buy the firm and today announced the deal was going ahead.
It plans to finance part of the asking price via a share placing that it hopes will net it around 拢170m, plus a new 拢150m medium-term loan and funds from a new revolving credit deal worth 拢350m.
Lagan, which is separate from Lagan Construction Group, run by Michael Lagan and which in February put four of its 30 compnaies into administration, operates a cement plant in Kinnegad and has nine active quarries, 13 asphalt plants and nine ready-mixed concrete plants.
In the year ended 31 December 2017, it generated revenue of 拢249m and earnings before interest, tax and depreciation of 拢46m.
It has a number of offices across Ireland as well as offices in Manchester and Livingston in Scotland as well as outposts in the US and Dubai.
Breedon and Lagan subsidiary Whitemountain already operate a joint venture in asphalt.
Pat Ward, Breedon鈥檚 chief executive, said Lagan was well run, well invested and had a strong track record.
He added that it represented 鈥渁 unique opportunity to enter a growing market with immediate scale and excellent opportunities for expansion鈥�.
Ward said the deal would 鈥渟ignificantly strengthen鈥� Breedon鈥檚 cement business, 鈥渁dds to our mineral and downstream resources, brings us a bitumen import/export business and adds real weight to our contract surfacing operations.鈥�
Breedon employs 3,000 staff and in 2016 reported turnover of 拢455m and a pre-tax profit of 拢47m.
Lagan Group鈥檚 Lagan Homes business is being retained.
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