HeidelbergCement is looking for a buyer for its Hanson UK building products operations, including the country’s biggest supplier of clay bricks, in a bid to reduce debt. The company said it is selling units outside of its cement, aggregate and concrete operations after running up debt with the UK£8bn takeover of Hanson in 2007. First-half disposals for the German cement producer have totalled EUR324m, including assets in Indonesia and Israel.
British business units expected to be divested of this year include Formpave, the paving division, Structherm, a maker of cladding, Bath and Portland Stone, which provides for drystone walls, and Hanson’s pre-cast concrete business. The company is hopeful of finding new owners by the end of the year. David Weeks, a spokesman for Hanson UK said a buyer had already approached the business about Thermalite, which manufactures aircrete building blocks.
However, the suitor was turned away because of its valuation of the company. Given the state of construction markets, Weeks stressed that there is no rush and that the process may take time. Hanson is Britain’s biggest supplier of bricks and its businesses in that division – such as Cradley Special Brick, London Brick, Red Bank – face being sold at a later date.
“It’s a long-term strategy,” Mr Weeks noted. “It may make more sense to hang on to them for another couple of years. The UK brick market has fallen by nearly 50 per cent.” Attracting companies to acquire some of the assets in the near-term at a price which HeidelbergCement think is reasonable is unlikely. “Hanson paid very high prices for some assets in the brick and concrete-block markets,” Bloomberg cited Collins Stewart analyst Imran Akram as saying.
“These will be difficult to sell in the current climate.” Hanson UK’s aggregates, cement and concrete businesses will not be sold, after being identified as core areas by the parent company in May.