Boral divests from Boral CSR Bricks JV


Boral Limited has agreed to sell its 40% stake in the Boral CSR Bricks joint venture to its joint venture partner CSR Limited for a total consideration of $133.9 million.

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The Boral CSR Bricks joint venture was established last year, producing in the excess of 600 million standard bricks across 12 manufacturing operations in New South Wales, Victoria, Queensland, South Australia, Tasmania and the ACT.

Boral’s CEO & Managing Director, Mike Kane said that while the JV has delivered satisfactory results and significant operating synergies following the integration of the two businesses, the time has come for the Company to redirect capital to its core operations.

“Boral’s strategy has consistently been to optimise assets to maximise our returns across our returns across our Australian building product portfolio, including realising value when the time is right,” Mr Kane said, adding that the sale is expected to be completed on 1 November 2016.

“Since its formation, the East Coast brick joint venture has performed well as we have worked hard over the last 18 months to integrate our businesses and deliver operational and overhead efficiencies. As a result, we have together created a more sustainable business.”

In addition to announcing the divestment from the Boral CSR Bricks JV, the company also confirmed that the previously announced North American Bricks JV transaction with Fonterra Bricks is also expected to complete on 1 November 2016 in the USA.

“This follows merger clearance from the US Federal Trade Commission announced on 22 September 2016,” Boral told the ASX.

“Boral will recognise its share of equity-accounted earnings from the 50:50 North American Bricks joint venture effective 1 November 2016.”