Australian brick manufacturer has acquired US brick manufacturer Redland Brick.
At a price of $48 million, the purchase covers four manufacturing sites across the US, one in Pennsylvania, and Virginia, and two in Maryland.
Redland Brick encompasses brands such as Cushwa, KF, Harmar, and TruBrix, brands which will enable Brickworks to grow across North America, and in particular the north east of the US.
Brickworks expects that the acquisition will delivery 3 per cent EPS accretion within 3 years, once synergies between the companies are realised.
Final requirements of the sale will be completed in February 2020.
Brickworks is Australia’s largest brick manufacturer, and Redland Brick has the capacity to produce up to 250 million bricks a year, and has sales of roughly 80 million bricks a year. Brickworks managing director, Lindsay Partridge, highlighted how the acquisition fitted within Brickwork’s growth strategy.
“We are pleased to welcome those Redland Brick staff joining the Brickworks Group, as we continue our expansion in the United States. With a suite of well-recognised brands, including the highly renowned Cushwa handmade and moulded bricks, the acquisition will further extend our industry-leading range and premium product positioning,” he said.
This latest acquisition comes after a series of purchases by Brickworks fo US brick manufacturers. In August 2019, Brickworks bought Sioux City Brick, based in Iowa, and acquired Glen-Gery in November 2018.
“These acquisitions follow a thorough strategic review, where the North American brick industry was identified as a highly attractive long-term growth opportunity for Brickworks. This strategy is underpinned by the significant value creation opportunities available through consolidation and rationalisation of under-utilised facilities across the industry,” said Partridge.
Partridge highlighted that these expansions of the Australian manufacturer enable the company to grow the role of brick in construction activity.
“As we have done in Australia, we will take an active role to lead the industry in the promotion of bricks. In light of the well-publicised structural failures and concerns over other sub-standard building materials being used around the world, we take pride in the timeless appeal and durability of our products,” said Partridge.