Breedon is a leading construction materials group in the UK and Ireland. It has 2 cement plants, around 80 quarries, 40 asphalt plants, 170 ready-mixed concrete and mortar plants, 9 concrete and clay products plants, 4 contract surfacing businesses, 6 import/export terminals and 2 slate production facilities.
Breedon aims to continue to grow organically and through acquisition in its chosen markets.
Collinson Grant worked with Breedon on two acquisition projects to assess potential synergies and cost saving opportunities. Breedon required support from a management consultancy with significant experience in post-acquisition integration and deep knowledge of the construction and building materials sector.
Our work provided a comprehensive understanding of the underlying performance, plans and prospects of each business, and identified opportunities for potential synergy. We met senior managers, visited sites and analysed relevant information and data. The projects focused on:
- providing a detailed analysis of baseline cost, applying a zero-based challenge and considering all costs afresh from the bottom up
- determining the most appropriate organisational structure for the combined business, including developing individual accountabilities and responsibilities and ways of working
- identifying opportunities to rationalise and consolidate the property footprint of the two businesses and more cost-effective ways to use property
- comparing the distribution networks of the two organisations and looking for opportunities to consolidate them, standardise on the most cost-effective specification and cost reduction when changing the mix of in-house and third-party logistics
- assessing the combined expenditure of both organisations and identifying opportunities to reduce cost by taking advantage of increased volumes, renegotiating existing contracts and improving specifications and terms with third party suppliers
- evaluating and mitigating risks associated with the acquisitions.
Collinson Grant used a systematic framework to capture, analyse and review all costs for relevance and importance to agreed objectives. We then identified the priorities for savings in the short, medium and longer term. We also used an organisation structure analysis tool to map the current organisation structure, jobs and accountabilities and performance measures to inform the development of options and provide specific recommendations on the new structure.
Rob Wood, Group Finance Director, said:
"This was the second major acquisition project I’ve worked on with Collinson Grant’s help in the past three years and yet again it was a huge support. Its analysis and findings enabled the post-acquisition integration activities to begin quickly and with a clear direction so that we quickly delivered value and enhanced our earnings"