Construction materials group Breedon has cemented its market position with a multi- million pound swoop for Sherburn Minerals Group.
The company, which has its Scottish headquarters at Ethiebeaton in Angus, has acquired the County Durham based heavyside building materials firm in a deal worth up to £15.7m.
While significant, the acquisition is much smaller than Breedon’s £336m capture of Hope Construction Materials earlier in the year.
That deal only went through after the Competition and Markets Authority cleared a plan forcing Breedon to sell off 14 sites in order to alleviate competition concerns.
The latest buy-out will see four Silverburn operated quarries and five ready-mixed concrete plants across the north of England join Breedon Group.
The company’s import terminal at Dundee – a facility that is used to distribute cement products – is also part of the sale along with a second import facility at Blyth in Northumberland.
Silverburn’s 110 staff are all being retained and will transfer to Breedon under TUPE regulations.
Breedon said the purchase price was made up of £9.5m in cash from its existing group resources, £6m of assumed debt and a further £200,000 due one year after completion of the deal.
Sherburn reported underlying earnings before interest, taxation, amortisation and depreciation of £1.8m from revenues totalling £16.1m in the year to March 31.
Breedon said Silverburn had mineral resources and reserves exceeding 21m tonnes at the time of purchase along with “significant cement storage capacity” at Dundee and Blyth.
Breedon Group chief executive Pat Ward said the Silverburn deal boosted its national geographic footprint whilst also bolstering its cement products operation.
“Following our acquisition of Hope earlier this year, which significantly expanded our geographical footprint in the north of England, Sherburn is a perfect infill acquisition for us. It gives us additional mineral reserves and access to new markets for our aggregates and concrete, as well as a first-rate workforce,” he said.
“It also complements our existing cement plant at Hope and will enable us to expand our cementitious business through the importation of cement and ground granulated blast-furnace slag (GGBS) through Sherburn’s two strategically located terminals in north-east England and eastern Scotland.”
Following completion of the acquisition Paul Allison, Sherburn’s current managing director and a minority shareholder, will remain with the business as a consultant.
