18th Feb 2019 16:54
LONDON (Alliance News) - Michelmersh Brick Holdings PLC said it has raised GBP5.0 million to partly fund the acquisition of clay brick manufacturer Floren & Cie.
The company also said it will use its existing debt facilities to fund the deal consideration.
Michelmersh issued 5.6 million shares at a price of 90 pence each, with placing price representing 0.6% discount to the closing mid-market price on Friday.
The company's shares closed up 1.1% at 91.50p each on Monday, giving it a market capitalisation of GBP79.1 million.
Canaccord Genuity acted as nomad and broker in relation to the placing.
Early on Monday, Michelmersh said it bought Belgian bricks manufacturer for up to EUR9.9 million, expanding its foothold in Europe.
The company said that Floren, which has operated in Belgium since 1896, manufactured 19.5 million bricks which were sold mainly in Belgium and the UK in 2018, generating revenue of EUR5.7 million and earnings before interest, taxes, depreciation and amortisation of EUR1.8 million.
"The strategic acquisition will enhance Michelmersh's product portfolio, significantly increase the group's overall output and provide a foothold in new European markets," the company added. "The board considers Floren to be an excellent strategic asset which gives Michelmersh access to the wider Benelux and German markets and adds significant value to the group."
Floren is being acquired for an initial EUR9.4 million with a deferred consideration of 400,000 Michelmersh shares, with a value no greater than EUR500,000, within 24 months based on certain targets.
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