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LONDON (Alliance News) - Michelmersh Brick Holdings PLC on Monday said it has acquired clay brick manufacturer Floren & Cie for up to EUR9.9 million, expanding its foothold in Europe.
The company also said it will raise GBP5.0 million through the issue of 5.6 million shares at 90 pence each to part fund the acquisition. The company will also use its existing debt facilities to fund the deal consideration.
Michelmersh shares were trading down 0.2% at 90.32p each on Monday morning.
The company said that Floren, which operates in Belgium since 1896, manufactured 19.5 million bricks which were sold mainly in Belgium and the UK in 2018, generating revenue of EUR 5.7 million and earnings before interest, taxes, depreciation and amortisation of EUR 1.75 million.
"The strategic acquisition will enhance Michelmersh's product portfolio, significantly increase the group's overall output and provide a foothold in new European markets," the company added. "The board considers Floren to be an excellent strategic asset which gives Michelmersh access to the wider Benelux and German markets and adds significant value to the group."
Floren is being acquired for an initial EUR9.4 million with a deferred consideration of 400,000 Michelmersh shares, with a value no greater than EUR500,000, within 24 months based on certain targets.
The share placing will be conducted by way of an accelerated bookbuilding process, with the shares placed representing 6.4% of the company's capital. Admission of the shares to trading is expected on Friday after which the firm will have 92.0 million shares in issue.
