THE BRICK sector has consolidated rapidly in the past two years and last week's agreed deal for Baggeridge takes that a step further.
Austrian giant Wienerberger has agreed a 216p per share deal with the management of Baggeridge.
With a market share of around 9 per cent, Baggeridge is the UK's fourth largest brickmaker.
Wienerberger is already the UK's third largest producer after entering this country two years ago by buying out Thebrickbusiness, which had a market share of about 15 per cent, for £90 million. The Austrian firm is already the world's biggest br ickmaker and the Baggeridge deal should increase the market share of its UK operations, which include Terca , to around 25 per cent.
Hanson remains the biggest player with a market share of around 33 per cent, closely followed by CRH - through its ownership of Ibstock - with a share of around 30 per cent.
As a listed company controlled by its founding family, Baggeridge was unlikely to lead any consolidation and was always going to come into play when the family decided to sell.
Shareholders that took profits when the stock peaked six months ago will have regrets - though the stock has underperformed - as Wienerberger has made a good offer.
With the brick sector widely seen as in decline, the deal values Baggeridge at £89.2 million and comes at a 29 per cent premium on the stock's closing price before the deal of 167.5p was announced.