Mining giant Anglo American and French cement group Lafarge are to sell a portfolio of UK construction material operations to steel tycoon Lakshmi Mittal, the companies announced on Friday.
The assets comprise: a Derbyshire cement plant; 172 ready mix concrete plants; five aggregates quarries; two asphalt plants; one marine aggregates wharf; one rail-linked aggregates depot; and Tarmac's 50% stake in Midland Quarry Products.
These are being sold for £272m in cash to Mittal Investments, run by the family of Lakshmi Mittal, who is the frontman and shareholder of steel giant ArcelorMittal.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
The companies said that the sale is conditional upon Competition Commission approval of setting up a 50:50 joint venture between Lafarge and Anglo's heavy building materials producing unit Tarmac, which will combine their cement, aggregates, concrete and asphalt businesses in the UK.
The firms said: "Completion of the JV is expected in early 2013 and once established, it will create a new, leading UK construction materials company, with a portfolio of high quality assets, drawing on the complementary geographical distribution of operations, the skills of two experienced management teams, and a portfolio of well-recognised, innovative brands."
The deal with Mittal Investments also includes a consideration of up to £30m though this is subject to the performance of the assets over the next three years. Meanwhile, around £13m relating to working capital of the divested assets not transferring over will be disbursed back to the Lafarge-Tarmac joint venture.
-
Water companies blocked from using customer money to pay “undeserved” bonusesThe regulator has blocked three water companies from using billpayer money to pay £1.5 million in exec bonuses
-
Will the Bitcoin price hit $100,000?With Bitcoin prices trading just below $100,000, we explore whether the cryptocurrency can hit the milestone.
