Barlo Group chief executive Mr Tony Mullins has said that the €55.8 million (£43.9 million) acquisition of Athlone Extrusions provides an opportunity for Barlo to expand its presence in the European sheet plastics industry.

Barlo and Athlone yesterday confirmed the recommended bid of €1.20 for Athlone shares, as was reported earlier this week in The Irish Times.

By the close of trading last night, Barlo had received acceptances from the management and the family of the late chief executive Jim Ryan representing 50.1 per cent of shares. In addition, Barlo bought 9.5 per cent of Athlone stock in the market.

Athlone has also reported its results for the year to the end of September and these came in marginally ahead of market forecasts, with pre-tax profits up 15 per cent to €6.2 million.

Group managing director Mr Jimmy McGee said that operating margins had been squeezed due to a time lag in passing on raw material price increases to customers. Margins had been restored by the final quarter.

Turnover rose 30 per cent to €47.8 million with markets being opened in eastern Europe.

The €1.20 a share that Barlo has offered for Athlone is marginally ahead of the €1.16 flotation price of three years ago, although Barlo emphasised that the price is 41 per cent higher than Athlone's price before the approach was made public. The offer also represents a 64 per cent premium over the average Athlone price in the three months to December 4th.

It is understood Barlo made its first approach to the Athlone board a year ago, but firm progress on the takeover had only been made in recent weeks.

Mr Mullins said: "The acquisition of Athlone represents an excellent opportunity to achieve a significant expansion of Barlo's market presence in the European sheet plastics industry.

"Barlo believes that the principal benefits arising from the acquisition will be the addition of Athlone's strengths in coloured plastics sheet to Barlo's strength in the transparent plastic sheet market."

Mr McGee, who will run the Irish plastics operations in Newbridge and Athlone after the acquisition, said: "The business case for operating as a wider pan-European business is compelling and we are very optimistic about the prospects of the combined plastics business where Athlone will play a significant role."