Readymix is at an advanced stage of negotiations to acquire Finlay, a sand and gravel group in Northern Ireland, according to reliable industry sources. A spokesman for Readymix said in line with the group's stated policy, it could make no comment.
If successfully concluded, it will be an important development for Readymix. Finlay, a private company, owned by the Finlay family, has operations throughout Northern Ireland.
Its headquarters is in Tullyvanon, Ballygall, Co Antrim and it also has a number of pre-cast concrete plants. The consideration is understood to be around £20 million (€25.39 million).
Readymix has a strong presence in the North (and the Isle of Man) through RMC Caterwood, which it acquired in 1996. It does not give a geographical breakdown of its profits, but the Northern (and Isle of Man) operations generated sales of £56.7 million, or 46 per cent of the total of £123 million, in 1998.
As the Northern businesses operate on much lower profit margins, due to competitive pricing, lower expenditure on roads and generally difficult trading conditions, their contribution to group operating profit could be as low as 30 per cent. These adverse factors led to a drop in profits from the Northern operations in 1998.
Readymix has been expanding its operations in Northern Ireland. RMC Caterwood recently acquired the business of PJ McCann and a concrete block operation at Ballynahinch, Co Down. These, and the takeover of Finlay, would somewhat address the geographical profit balance. But it would also mean that it would have more of its operations in a low-margin area.
Readymix has also been expanding its operations in the Republic. Last year it completed the purchase of Laois Concrete which will complement its operations in Offaly and Kilkenny.
Group pre-tax profit rose from £12.6 million in 1997 to £14.5 million in 1998. Further growth is anticipated for this year but most of this will come from the operations in the Republic.
