Construction materials giant Breedon Group has completed a 拢178 million deal to buy part of Cemex 海角视频 group 鈥 pending Competition and Markets Authority (CMA) approval.
The Leicestershire building materials company has acquired 100 鈥渜uality assets鈥 from the Rugby-based company, underpinned by approximately 170 million tonnes of mineral reserves and resources.
While the CMA investigates, the newly acquired business will be ring-fenced and led by an independent management team, operating from its own offices under the name Pinnacle Construction Materials.
The acquisition covers around 100 locations across six divisions in Scotland, Wales, North-East England, Norfolk, the East Midlands, and Yorkshire, which in the year to 2018, had revenues of 拢178 million.
It operates in areas including aggregates, asphalt, ready-mixed concrete, concrete products and cement, together with contracting services, and has 650 staff.
Breedon, which is based near East Midlands Airport in north Leicestershire, has previously said the acquisition was consistent with a strategy of acquiring businesses with 鈥渟trong potential for performance improvements and synergy benefits鈥.
The deal does not include two large cement production plants at Rugby, in Warwickshire and South Ferriby, North Lincolnshire. The latter has been overhauled following a devastating tidal surge in the River Humber in 2013, when a year鈥檚 production was lost.
Breedon saw revenues rise eight per cent in the first 10 months of 2019 at around 拢800 million.
However in the first half of 2020 revenues were down a quarter on the same period last year at 拢335.3 million.
The lockdown in the economy saw it record a pre-tax loss of 拢10 million in the last six months, compared to a profit of 拢30.5 million in the first half of 2019.
However, it said site reopenings started in early May and by June said revenues had recovered to 99 per cent of those in June 2019.
Breedon operates two cement plants as well as quarries, asphalt plants and ready-mixed concrete plants, and also has slate production, concrete and clay products manufacturing, contract surfacing and highway maintenance operations.
Chief executive Pat Ward said: 鈥淔ollowing the encouraging performance of our businesses in the first 12 weeks of the year, the move into lockdown and immediate fall in demand in the latter part of March led us into a swift and managed shutdown of the majority of our operations, leaving open only those which were servicing critical needs.
鈥淭his decisive action ensured the protection of our employees, left our sites in a safe condition and also positioned us to return quickly to production when demand began to return in early May.
鈥淭he recovery in our markets now appears to be well underway, and we have seen continued improvement into July.
鈥淭he great majority of our sites are now open, including both our cement plants.
鈥淲hile near-term uncertainty remains, there is significant pent-up demand to be satisfied in both housing and infrastructure, reinforced by the substantial programme of investment confirmed by the Chancellor earlier in July.
鈥淟ooking to the longer-term, we believe the outlook for our markets remains positive, supporting our confidence in the prospects for the group.鈥
Following the acquisition the group will have more than 1 billion tonnes of mineral reserves and resources.
Completion has been subject to a TUPE consultation with staff while the results of a preliminary CMA investigation are expected on or before August 26.
Breedon said: 鈥淔ollowing the conclusion of the CMA鈥檚 investigation, which could still take several months, and subject to the outcome of that investigation, the assets are expected to be incorporated into Breedon鈥檚 海角视频 business.鈥
Breedon currently employs almost 3,000 people and has almost 900 million tonnes of mineral reserves and resources.
