Breedon targets acquisitions from Lafarge and Anglo-American UK sales

Breedon targets acquisitions from Lafarge and Anglo-American UK sales
Published: 02 May 2012


Breedon Aggregates is eyeing the quarry assets of Lafarge and Anglo American PLC that need to be sold for their British joint venture to succeed.

The aggregate company is likely to bid on the quarries up for sale after the Competition Commission ruled yesterday that a merger between Lafarge and Anglo American’s UK subsidiary, Tarmac, could go ahead only after substantial disposals.

This means that the Hope Cement works, in Derbyshire, and a host of quarries, ready-mixed concrete and asphalt plants will come onto the market.

The share price of Breedon, born out of the failure of Ennstone, which Mr Peter Tom acquired in 2008, has leapt by more than 25 per cent since February. The stock rose 14 per cent or 3p to 24¼p yesterday, The Times reports.

Mr Tom, who is chairman of Leicester Tigers RFC, declined to comment. But one senior industry executive told The Times: "This is what Breedon was set up for, to be a consolidator in the industry. And it has the backing of institutional investors for such a deal."

The commission has ordered the French conglomerate to sell its 1.3Mta Hope cement plant and the nearby Dowlow quarry, local rail depots and more than half of the future venture's ready-mixed concrete operation.

The commission's desire to create a new force in the industry is understood to rule out bids from the three other leading players: Cemex, Holcim – which bought Aggregate Industries from Mr Tom – and Hanson's owner, HeidelbergCement.

The proposed Lafarge-Tarmac tieup has been sensitive because of the British aggregates market is concentrated in the hands of five leading players.

Breedon currently operates 26 quarries, 18 asphalt plants and 41 ready-mixed concrete plants in England and Scotland, employing more than 800 people.