Article – BusinessDesk
Friday 29 July 2016 04:40 PM
Fletcher trims $12 mln from slimmed down Higgins acquisition
By Paul McBeth
July 29 (BusinessDesk) – Fletcher Building paid $12 million below the flagged purchase price to buy rival construction company Higgins Group Holdings after dropping Horokiwi Quarries from its application to reduce its dominance in the aggregates market.
The Auckland-based company today completed its acquisition for $303 million, adding Higgins’ roading units in New Zealand and Fiji, and the firm’s aggregates businesses excluding Horokiwi, Fletcher said in a statement. The construction group had initially planned to pay $315 million for the Higgins takeover, but amended its application to the Commerce Commission, which identified the Horokiwi joint venture with Fulton Hogan as creating a key competition concern.
Higgins transferred its ready mix concrete and property businesses to existing shareholders prior to the acquisition.
Separately, an Overseas Investment Office decision released today showed Fletcher paid $2.4 million for two blocks of land next to its Hunua Quarry in Auckland “in order to act as a natural noise buffer, allowing the Hunua Quarry to increase their hours of quarrying operation”. The OIO approved the deal, which involved sensitive land, last month.
Fletcher shares rose 1.3 percent to $9.58, having gained 29 percent so far this year.