Wienerberger buys Baggeridge

Austrian brick and tile manufacturer Wienerberger has upped its stake in the UK brick market after it reached an agreement to buy Baggeridge Brick for 216p per share, valuing the company at £89.2m.

The deal represents a premium of 29% over the closing price in Baggeridge shares when the deal was announced last week, and a 32% premium on the average over the previous 12 months.

However, Wienerberger said the acquisition is a good deal and offers the company an opportunity to expand its market share in the UK, the largest market in Europe for facing bricks.

Wienerberger already sits in third place in the UK with just under 20% of sales following its acquisition of merged companies Ambion and Chelwood in 2004.

The addition of Baggeridge's estimated 8% market share will take combined sales much closer to its leading rivals, Ibstock and Hanson, both estimated to have around 30% of the market.

[Contract Journal, 23 August 2006, p 11]