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CSR Limited (ASX:CSR) and Boral Limited (ASX:BLD) will combine their brick operations on the east coast, to save money in a declining industry.
The joint venture is expected to save up to $10 million in costs each year, pending approval by the Australian Competition and Consumer Commission.
“The Australian cladding industry has faced major changes in demand over the past 30 years, resulting in a significant reduction in brick use.
The deal is expected to net $230 million in revenue annually, with CSR owning a 60 per cent stake and BLD on 40 per cent following a valuation.
“It is about strengthening the opportunity for employees and reinvesting in the industry while delivering satisfactory returns through the building cycle,” he says.
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