Building materials group CRH is seeking to expand its business in Switzerland with the €340 million acquisition of Getaz Romang.
The Dublin-listed company yesterday said it was submitting a public tender offer for the entire share capital of Getaz Romang and has the backing of the Swiss group's board.
The offer price of 1,125 Swiss francs (€698.80) per share represents an all-time high for Getaz's stock and is at a 22.5 per cent premium over the stock's average closing price of the last 30 trading days.
Liam O'Mahony, CRH's chief executive, said Getaz's extensive operations in the French-speaking parts of Switzerland made it an excellent fit with CRH's own business in the German-speaking region of Switzerland.
"The combination of the two businesses will firmly establish the enlarged group as a major national player in the Swiss builders merchanting sector," he said. "It offers the opportunity for both companies to achieve operational synergies, greater depth in their distribution networks and an enlarged base from which to pursue future growth."
Getaz had sales of SFr794 million (€496 million) in 2005 and profit before tax, depreciation and amortisation of SFr45 million. In 2006, its sales were SFr875 million, which when combined with the SFr670 million of revenue generated by CRH's own business in the region, creates an entity with annual sales of more than SFr1.5 billion.
Analysts welcomed the acquisition, saying it would create one of the largest builders merchant businesses in Switzerland. Shares in CRH were down 2.5 per cent in weak markets. Getaz shares rose more than 20 per cent, to close just below the offer level.
CRH is due to release its full-year results this morning and analysts are confident of a strong performance. In January the company estimated its 2006 pretax profits grew by 23 per cent, to almost €1.6 billion. Last year it spent €2.1 billion on 31 acquisitions, buying across all its European and US territories. Getaz is the first acquisition to be announced this year.
