Cinven and Royal Bank Private Equity (RBPE) have received authorisation from the European Commission to proceed with the merger of their brick manufacturing assets to form Galileo Brick Ltd. Both private equity firms will hold 45 per cent of the new company, with the remaining 10 per cent owned by management.
The merged company will have around 15 per cent of the market, making it the second biggest player in the UK brick industry. It will be in the same position as Hanson, as joint number two behind Ibstock.
Ambion Brick Company, owned by RBPE, and Chelwood Group, owned by Cinven, are UK-based manufacturers of bricks for use in the construction of buildings, both residential and commercial.
The Commission's market investigation decided that the present operation will have no anti-competitive impact on the structure of the market, given that in the UK market for bricks there are a number of other strong competitors.
Cinven and RBPE expect to formally combine the companies this week. The combined company's value will be in the order of £50m to £100m, although financial details of the merger have not been disclosed.