Readymix shares soar as takeover discussions revealed
TROUBLED concrete products firm Readymix, which helped to build the new stadium at Lansdowne Road and the Titanic quarter in Belfast, said it is in talks that could lead to a takeover. Its shares soared as a result.
The concrete and crushed stone company, listed on the Dublin Stock Exchange and majority-owned by Mexico-based Cemex since 2005, said the discussions followed an approach from third parties.
Readymix has 360 employees with around half based in Dublin and the rest spread around the rest of the island and the Isle of Man.
The shares jumped as much as 53pc after the announcement but are still languishing at levels not seen since the mid-1990s.
The company's market value is now a fraction of its former size and the shares often don't trade in Dublin. Despite the illiquidity, almost 1.1 million shares traded hands in a single day last week -- the largest one-day trade for more than two years.
"Discussions are at an early stage and there can be no certainty that these will lead to an offer," the company said in a brief statement. "A further announcement will be made when appropriate."
Readymix snapped up small rivals during the boom and invested in three advanced ready-mixed concrete plants which it hoped would improve the company's ability to serve large infrastructure projects.
Those plants were completed just as the construction sector went into decline. The company has since sold property as well as some units and closed a pipe and tiles unit to save costs.
It said in the spring that it expected sales and profits to fall this year after posting a pre-tax loss of €6.6m in the first six months of the year.
The company sold its pre-cast concrete products business -- which operated on both sides of the Border and employed 800 people -- to Co Tyrone-based Acheson and Glover for more than £33m a few years ago.
"While the group has endured a torrid time on the operating front, we have stated on numerous occasions that Readymix is supported by a strong balance sheet, with a marginal net debt position of €2.1m," David O'Brien, an analyst at Goodbody Stockbrokers in Dublin said in a note yesterday. Mr O'Brien has a 'buy' rating on the stock.