Grafton snaps up Jackson Building Centres

Irish builders merchant and DIY group Grafton is to acquire the UK's seventh largest builders merchant Jackson Building Centres for €135.4m, it has been announced today (Tuesday).

The group is also planning to raise €70.6m through a rights issue to partly fund the acquisition. Chief executive Michael Chadwick said Grafton had decided on a rights issue as funding the acquisition solely through debt would leave Grafton over-geared.

Grafton also released a trading update which estimated pre-tax profits at no less than €80m for 2002, while the company said UK activities accounted for 70% of turnover and showed strong profit growth.

It said its Irish businesses improved in the second half, enabling them to match 2001 levels despite the slowdown in the economy and the construction sector.

Jackson's turnover last year is estimated to be around £130m, with pre-tax profits of £6m. Its acquisition will give Grafton a share of around 8% in the British market.