Breedon sells plants to Tillicoultry Quarries to progress Cemex deal
Construction materials supplier Breedon has agreed the disposal of certain assets to Tillicoultry Quarries Limited for £12.2 million on a cash and debt free basis as it moves to address competition concerns regarding its acquisition of around 100 sites from Cemex.
The 14 sites to be divested include ten ready-mixed concrete plants and an asphalt plant and associated aggregates depot in England, and two quarries in Collessie and Loanleven and a cement terminal in Dundee.
Breedon is divesting these assets at the direction of the Competition and Markets Authority (CMA) in order to address concerns that Breedon’s purchase of certain assets from Cemex Investments Limited (CEMEX UK) gives rise to a realistic prospect of a substantial lessening of competition in certain areas.
Completion of the disposal is subject to final confirmation by the CMA, following a public consultation inviting interested parties to submit their views, that it will accept the undertakings offered by Breedonin lieu of a Phase 2 reference and the approval of Tillicoultry Quarries Limited as a purchaser for the assets.
The company expects to be in a position to complete the disposal before the year end. Following completion of this disposal, the group will integrate the remaining former CEMEX UK assets into its existing operations and implement its plans for performance improvement to deliver value from the acquisition.
Pat Ward, Breedon’s Group chief executive, said: “We are very pleased with the outcome of this process and believe it is in the interests of all stakeholders.
“It allows Breedon to realise fair value for the assets disposed of which, together with the people employed in them, will be in good hands under new ownership of Tillicoultry Quarries.”
The ten ready-mixed concrete plants are in Hartlepool, Stockton, Middlesbrough, Whisby, King’s Lynn, Wisbech, Peterborough, Kidderminster, Costessey, and Snetterton. The asphalt plant and aggregates depot is in Ely.
Wallace Menzies, director of Tillicoultry Quarries, added: “The purchase of these 14 new sites will allow Tillicoultry Quarries to continue to build on and invest in our existing capabilities, enhancing our offering with more of our core products and opening up in new locations.”