Three directors of Cork Builders Providers will receive almost €2.4 million each as a result of the €23.75 million takeover of the company by building materials group Heiton Holdings.
The three directors - Mr Dan Twomey, Mr Brian Murphy and Mr John Cotter - each own 10 per cent of Cork Builders Providers, with the remaining 70 per cent owned by Skerries Nominees, the investment company for Goodbody Stockbrokers' private clients.
Skerries Nominees will receive €16.6 million for its stake in the Cork company.
Cork Builders Providers is the market leader in the region in heavy-end merchanting for major infrastructural projects. It also includes a hire business and a small manufacturing business.
Last year, the company had sales of €28.1 million and pre-tax profits of €3.2 million, a 23 per cent increase on the €2.6 million profits in 2000.
Net assets at end-2001 were €10.7 million.
Heiton is paying €23.25 million in cash while the remaining €500,000 will be paid through the issue of 169,298 new Heiton shares after one year.
Analysts in Dublin welcomed the acquisition, with Goodbody's Mr Robert Eason estimating that the acquisition will add between 2.7 and three cents to earnings in a full year.
ABN-Amro's Mr Pat O'Sullivan Greene said that, at a multiple of 0.85 times sales, the acquisition was reasonable given Cork Builders Providers's 12.1 per cent operating margins. Heiton itself said the acquisition would be earnings-enhancing in the first year.
Heiton group chief executive Mr Leo Martin said: "This is a tremendous acquisition in that it fits with our stated strategy to develop and sustain a balanced portfolio of businesses, segmentally and geographically.
"It is particularly attractive as it expands our service on offer in the key infrastructure segment of the market where Cork Builders Providers has built a strong presence over the years."
Cork Builders Providers operates from a base near the Kinsale Road roundabout in the south of the city and will increase Heiton's outlets in Cork to three. Already, Heiton has a steel merchanting operation at Tory Top Road and a builders merchants at Bishopstown. The Bishopstown site and the 15-acre site adjacent to it has been earmarked for substantial commercial and retail development for which planning permission has been sought.
Heiton, which is 22 per cent-owned by rival builders merchants Grafton, will now have 24 builders merchants outlets nationwide.
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