Paving stone manufacturer Marshalls has today laid down a bet on the new build housing market with the £17.2m acquisition of brickmaker Edenhall, boosting its shares this morning.
The specialist paving maker boosted expectations ahead of its full-year results, saying revenue growth had bred strong trading in the second half, with a programme designed to promote organic growth “progressing well”.
Marshalls said it was buying the independent concrete brick manufacturer for an initial £11.8m with a deferred payment of £5.4m.
“Edenhall is a profitable business with a strong track record of quality, reliability and service, primarily targeting builders' merchants and regional and national housebuilders,” said Marshalls’ chief executive Martyn Coffey.
The bolt-on acquisition is part of a plan to occupy parts of the market where the company anticipates strong growth, including new build housing, road, rail and water management.
Net debt of £5.2m has been deducted for the initial cash consideration, the company added.
“The acquisition of Edenhall represents a significant step towards achieving further growth in the new-build housing market,” said Coffey.
Yorkshire-based Marshalls has manufacturing sites in the UK and Belgium, and overseas offices in the US, Dubai and China, employing around 2,300 people.
Revenue for the 11 months ending in November was up 14 per cent at £465m, it added in a trading update. A full-year report is expected on 14 March.
Shares climbed steadily all morning and were up around 13 per cent at midday.