Breedon Group Plc Acquires Sherburn Minerals Group for £15.7m
Breedon, the UK's largest independent construction materials group, announces it has entered into a binding agreement to acquire the Sherburn Minerals Group ("Sherburn") for a total consideration of up to £15.7 million.
Sherburn is a leading independent heavyside building materials business headquartered in County Durham, employing approximately 110 people. It operates four quarries and five ready-mixed concrete plants in County Durham, Northumberland, North Yorkshire and Cumbria. It also distributes cementitious products from two import terminals at Blyth near Newcastle and Dundee in eastern Scotland.
Sherburn reported an underlying EBITDA of £1.8 million on revenues of £16.1 million in the year to 31 March 2016. It has in excess of 21 million tonnes of mineral reserves and resources, together with significant cement storage capacity at its two terminals.
The purchase price will be satisfied by the payment of £9.5 million in cash, funded from the Group's existing resources, together with the assumption of £6.0 million of debt. A further conditional payment of £0.2 million is payable one year after completion. Following completion of the acquisition Paul Allison, Sherburn's current Managing Director and a minority shareholder, will remain with the business as a consultant.
Commenting on the acquisition Pat Ward, Breedon's Chief Executive, said: "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.
"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."