The Brief:
Heidelberg Materials Australia has completed its $1.7bn acquisition of Maas Group’s construction materials business.
Mallesons and HSF Kramer steered the deal through a world-first test of the ACCC’s new regime.
Heidelberg Materials has bulked up in Australia.
The German building materials giant has closed its $1.7bn buy of Maas Group’s construction materials business, going from signing to completion in under eight months.
Along the way, it became the first deal to land a conditional Phase 1 approval under the ACCC’s new mandatory merger regime.
The deal
In February, ASX-listed Maas Group inked a Share Sale Deed to sell its construction materials division to Heidelberg for cash consideration of up to $1.703bn.
That includes $120m in contingent consideration, tied to post-completion operational and commercial milestones.
Heidelberg expands its footprint across NSW, Queensland and Victoria: 40 quarries with combined reserves of over 350 million tonnes, 22 concrete plants, two asphalt operations and a recycling site. Maas kept certain freehold land and leased it to Heidelberg under long-term commercial leases.
The price implies an 8.4x EBITDA multiple after synergies.
The ACCC test
Competition was the big hurdle.
The ACCC flagged three trouble spots. In Blackwater, Heidelberg and Maas were the only ready-mix concrete suppliers. In the Illawarra, the deal would have combined major ready-mix suppliers and left customers with few alternatives. In Biloela, it would have thinned out quarry operators supplying coarse aggregates.
Heidelberg’s fix? Sell three of its own ready-mix plants and its Yalkara quarry.
It worked. On 31 July, the ACCC approved the deal with conditions. It was the regulator’s first Phase 1 decision with conditions since the regime kicked off, sparing the parties an in-depth Phase 2 review. The price Maas received was untouched.
From there, FIRB and shareholder approvals followed. With the Maas family backing the deal, shareholders signed off with 99.99% of votes in September. Completion was announced on 2 October.
Who’s acting
Mallesons advised Heidelberg Materials from signing to completion, led by partner Adrian Perkins and senior associate Jovana Zelenbaba. Partners Lisa Huett and Jennifer Barron led the competition workstream, supported by senior associate Joe McQuillen and solicitor Ricky Aggarwal.
HSF Kramer advised Maas Group, led by partner Nicole Pedler with senior associate Marijana Banovac and solicitor Arda Reznikas. Partner Liza Carver led on competition, partner Luke Simpson on property, and partners Kwok Tang (TMT), Michael Gonski and Nicholas Ogilvie (Employment) also assisted.
Source: Mallesons (Oct), HSF Kramer, Mallesons (Aug), MAAS (Feb), Heidelberg, MAAS (Oct), ACCC