Michelmersh Brick - Acquisition of Carlton Main Brickworks Limited
(the "Company" or "Michelmersh" or the "Group")
Michelmersh is pleased to announce that it has acquired the entire issued share capital of
Carlton is a highly respected regional brick manufacturer, operating from a 93-acre site brickwork based in
· Carlton is being acquired for a gross consideration of up to
· Carlton reported audited turnover of
· Carlton is expected to increase Michelmersh's output to over 100 million bricks per annum, an expected increase of over 40 per cent. to Michelmersh's current output.
· Michelmersh is funding the acquisition through the issue of ordinary shares in the Company, its own cash resources and new debt facilities provided by HSBC including a
· The Acquisition will give Michelmersh access to new regional markets, provide opportunities for cross selling and product synergies and increase output efficiency. Other operational synergies are expected to benefit the enlarged Group over time.
· The Acquisition is expected to be significantly earnings enhancing in the current financial year and increase the overall operational cash flow of the Company going forward, assisting in, post debt servicing and repayment, further investment within the Group and future shareholder distributions.
The Board considers that the acquisition of Carlton is an important strategic step forward in the growth of the Company, adding significant scale, output and earnings to the Group. Michelmersh's turnover and profit before tax will be immediately enhanced by the addition of Carlton.
The acquisition gives the Company the ability to expand its quality product offering in line with our premium-centric core strategy, and consequently will increase the Group's annual output to 100 million bricks. Furthermore, the addition of Carlton will broaden an already very strong and loyal customer base, giving access to new regional markets with cross sales opportunities and product synergies. Carlton also brings with it a popular and highly regarded RMI focused product line. This itself will give the enlarged Group the ability to strengthen its market offering whilst greatly improving efficiency and output per capita.
The Group welcomes the Carlton team to the business and look forward to building on the significant success already achieved by its dedicated team in
Financial Information on Carlton
In the 12 months ended
Acquisition Terms of Carlton
The gross consideration for Carlton is up to
The net consideration for Carlton is being financed through a mixture of new facilities provided by HSBC and its own cash balances. The Board are also anticipating proceeds from the completion of the sale of the Dunton landfill site shortly. The new bank facilities comprise:
Not all of the facilities will be drawn initially but will provide headroom for seasonal cashflows and investment.
The maximum net consideration of Carlton will be satisfied as follows:
- Cash on completion of
- 4.7 million Michelmersh ordinary shares of
Application has been made for 4,694,444 ordinary shares of
Integration of Carlton
The Stephenson family has owned Carlton since the 1970's and the vendors comprise Oliver and
Carlton will sit alongside the Group's other brickworks and will continue to manufacture its well respected range of products. The current Managing Director,
Carlton has invested in its business particularly over recent years and has a strong production capability. Under Michelmersh, investment in plant and process is a core consideration and operations will be evaluated to determine whether investment can improve efficiencies.
This announcement contains inside information.
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Established in 1997 the Company has grown through acquisition and organic growth into a profitable and asset rich business, producing over 100 million clay bricks, tiles and pavers per annum. Michelmersh currently owns most of the
Michelmersh strives to be a well invested, long term, sustainable, environmentally responsible business. Opportunity, training and security for all employees, whilst meeting the needs of stakeholders are at the forefront of everything we do. We aim to lead the way in producing some of
This information is provided by RNS
Quick facts: Michelmersh Brick Holdings Plc
Market Cap: £96.06 m
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