Company agrees to sell Midland Brick to Western Australian consortium, in line with strategy
BORAL Ltd have entered into an agreement with a Western Australian consortium to sell their Midland Brick business, including around 800ha of associated landholdings, for A$86 million. Proceeds from the sale will be used to reduce debt and fund strategic growth opportunities.
Mike Kane (pictured), Boral’s chief executive officer and managing director, said the sale was consistent with the company’s strategy of focusing on construction materials in Australia and reducing exposure to bricks globally.
‘Our focus in Australia has been to continue to invest in our leading integrated construction materials business, where we supply materials to residential, commercial and infrastructure building and construction markets across all states and territories,’ he said.
‘Having divested our 40% stake in the CSR Boral Bricks joint venture in 2016, the sale of Midland Brick completes our exit from bricks in Australia, for combined proceeds of around A$215 million over the past three years.’
Mr Kane continued: ‘We have owned and operated Midland Brick for close to 30 years and we recognize and value the contribution the business has made to the Boral Group over that time.
‘We are confident that this change of ownership will strengthen Midland Brick’s prospects for the future, which is great news for customers and our local staff.’
The new owners have said they intend to focus on further strengthening Midland Brick’s position as a locally owned, sustainable business with a record of serving the Western Australia building industry for more than 70 years.
They expect to undertake an orderly redevelopment of surplus lands, helping to focus Midland Brick’s operational footprint and substantially improve the local amenity.
The transaction is expected to complete by the end of 2019, or soon after, and is subject to a number of customary pre-closing conditions, including third party consents.