Breedon buys Cemex operations in UK for £178 million

The firm, which has operations across Shropshire and the West Midlands, will take control of 49 ready-mix plants, 28 aggregate quarries, four depots, one cement terminal, four concrete products operations and 14 asphalt plants.

Parts of Cemex’s Paving Solutions business in the UK are also included in the sale to Breedon.

Cemex’s UK assets comprise 100 active operations across six divisions located in Scotland, Wales, North-East England, Norfolk, the East Midlands, and Yorkshire.

The acquisition will boost Breedon’s mineral reserves and resources by 170 million tonnes – enough to last more than 27 years at current extraction rates.

Breedon said the deal will save it about £2 million by the third full year following completion. It will mean the firm will employ about 3,600 people.

Pat Ward, Breedon’s Group chief executive, said: “This is a unique opportunity to extend our national network through a single value-enhancing transaction, substantially increasing our footprint in several regions of Great Britain where we are currently underrepresented and adding approximately 170 million tonnes of mineral reserves and resources. It also delivers a step-change in the development of our national asphalt strategy.

“There is potential to drive significant performance improvements across these new assets and they will also strengthen our platform for further organic growth and bolt-on acquisitions.

“In addition to the cost synergies we anticipate, we also expect the deal to be accretive to both earnings and free cash flow in the first full year, with a positive ongoing impact on the cash generation of the enlarged group.”

Breedon will notify the UK Competition and Markets Authority for clearance, but said that completion was not conditional on conclusion of the CMA process.

The deal is expected to be finalised in the second quarter of this year.