A US affiliate of Lone Star Funds is set to buy Hanson Building Products for an aggregate purchase price of £900m. HeidelbergCement expects the transaction to close before the end of March.
Up to £65m will be payable in 2016, depending on the performance of the business in 2015.
HeidelbergCement put Hanson Building Products up for sale to focus on processing and refining raw materials for its core products of cement and aggregates, rather than on building products like bricks and Thermalite (aircrete) blocks. The division also includes Hanson Formpave, which specialises in sustainable drainage systems, Hanson Structherm, manufacturers and installers of structural cladding systems, Hanson Floors and Precast, which makes bespoke precast concrete products.
Irvine Whitlock, the specialist brick and block laying contractor, is not included in the sale.
Hanson Building Products is a leading manufacturer of concrete pressure and gravity pipes in North America, as well as one of the largest brick producers in both North America and the UK. The business has 4,621 employees on both sides of the Atlantic and has a network of 107 manufacturing plants and 11 distribution facilities in the USA, Eastern Canada and the UK. In 2013 revenues totalled approximately £700m and adjusted pro-forma EBITDA reached close to £60m.
HeidelbergCement CEO Bernd Scheifele said: “Hanson Building Products is a multinational business with leading market positions, but the focus of its product portfolio on bricks, pressure and gravity pipes and precast is outside the core businesses of HeidelbergCement. We are pleased that Lone Star will acquire this business, which as an experienced financial investor will support the sustainable development of the business going forward.”
HeidelbergCement will use the proceeds to reduce its debt. “This is an important step towards reaching our target financial metrics that are relevant for improving our credit-worthiness,” Dr Scheifele added.