Lagan Group — one of Ireland’s largest cement, building products, and contractors — has been sold for €526m after it completed the sale of most of its business to the London AIM-listed Breedon Group.
News of the unsolicited approach first broke in February and Lagan again confirmed to the Irish Examiner no Lagan company subject to pyrite legislation forms part of the transaction.
Breedon said the Lagan deal would allow it to do further “bolt-on” acquisitions.
“Lagan represents a unique opportunity to enter a growing market with immediate scale and excellent opportunities for expansion,” said Breedon chief executive Pat Ward.
Kevin Lagan, whose father Peter founded the original Lagan business from the Whitemountain quarry on the Belfast hills almost 60 years ago, will keep control of Lagan Homes.
Lagan Homes is a large housebuilder in the North and had in the recent past signalled plans to expand into Republic. The business being sold is one of Ireland’s largest contractors and building products groups.
Contracts in the past included work at airports at Shannon, Dublin, and Belfast, as well as numerous road and tunnel contracts across the island.
The Lagan Cement unit is the third-largest Irish cement manufacturer and owns a cement plant in Kinnegad in Westmeath and nine quarries; its Lagan Products unit is a major sand producer and roof tiles-bricks-and-concrete blocks maker; and its Lagan Asphalt unit has 13 plants, as well as terminals in Belfast and Dublin for bitumen, It also owns the large Welsh Slate business.
Lagan posted earnings of £46m (€53m) on sales of £249m last year. Breedon said it expects to tap cost savings of £5m in the coming years. Shares in Breedon climbed 6%, to value the group at over £1.13bn.
“We are delighted to have completed our largest acquisition to date and particularly pleased that it has been so strongly supported by our shareholders,” Breedon said.
“From a strategic perspective, it provides us with a stronger platform from which to pursue further organic growth and bolt-on acquisitions,” it said.