McAlpine says yes to £572m buyout by rival

Dec 11 2007 by Peter McCusker, The Journal

THE creation of a £4.7bn building company moved a step closer after Alfred McAlpine agreed to be bought by larger rival Carillion for £572m.

The tie-up will form one of the largest construction and support services firms in the UK.

Wolverhampton-based Carillion has been pursuing McAlpine since August, but the cash and shares deal is less than the £599.6m agreed in November due to recent stock market pressure.

The deal is the latest move on the acquisition trail for Carillion, which also bought rival Mowlem for £313m in February 2006.

Carillion chairman Philip Rogerson said the move was an “excellent strategic fit” with the enlarged company, gaining from McAlpine’s presence in the high-growth support services sector.

The company will also benefit from McAlpine’s road maintenance and utilities operations, as well as boosting its construction ambitions in the Middle East.

The tie-up is also expected to provide around £30m in annual cost savings in the first year following the deal.

McAlpine was established in the 1930s as an offshoot of the building company started by Sir Robert McAlpine in 1869 and became a listed company in the 1980s.

It will become a private, wholly-owned subsidiary of Carillion when the deal is completed.