CRH proposal to acquire Adbri

CRH has entered into an agreement to acquire Adbri Ltd. Under the proposal, CRH would partner with Australian family-owned business, Barro Group, which has an approximately 43 per cent share in Adbri. CRH currently has a 4.6 per cent interest in the company via a cash settled derivative and would acquire the remaining approximately 57 per cent of Adbri’s shares not owned by Barro with the intention to delist Adbri from the Australian Securities Exchange (ASX).

CRH and Barro have submitted a non-binding offer to acquire 100 per cent of Adbri for a cash price of AUD3.20 (US$2.15) per share. Adbri recently announced that its 2023 underlying EBITDA is expected to be in a range of AUS310-315m and the offer represents a multiple of approximately 9x enterprise value to expected 2023 underlying EBITDA.

Albert Manifold, chief executive of CRH, said, “We are very pleased to announce this potential acquisition of Adbri in partnership with the Barro family. We have held a long-term interest in the Australian construction materials market, which has attractive attributes including stable market dynamics and positive growth prospects, similar in nature to the Southern United States and Central and Eastern Europe where we have a significant presence.

“Adbri is an attractive business with quality assets that complement our core competencies in cement, concrete and aggregates. With its leading market positions in Australia, we are delighted that this opportunity has presented itself to us. It is the next logical step for CRH to expand our existing presence in Australia, where we have been operating for 15 years.

This acquisition would strongly complement our existing Australian business, creating additional opportunities for growth and development. We look forward to working with the Barro family over the coming years to enhance the long-term performance of the business, leveraging our scale, industry knowledge and technical expertise to improve long-term growth and operating performance and drive value to achieve the true potential of the business.”