Home > Boral, CSR propose bricks JV

Boral, CSR propose bricks JV

Editorial
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Boral and CSR announced plans on Friday to merge their brick-making operations.

The proposed joint venture would be 60 per cent owned by CSR and 40 per cent by Boral, and would cover 12 sites in Victoria, NSW, Queensland, South Australia, Tasmania and the ACT.

The Australian puts the annual capacity of such an operation at 600 million bricks a year, with a revenue of $230 million.

Brick production in Australia has fallen by 46 per cent from its 1981 peak due to reasons including changed building methods and a move towards apartments being built.

"The reduced level of utilisation in our brick manufacturing plants coupled with high input costs has meant that brick production in Australia has been increasingly challenged," said Mike Kane, Boral’s CEO, in a statement.

"This joint venture is aimed at driving efficiencies across the combined network of operations and would provide a path for Boral to realise acceptable returns for our brick business and therefore secure our long-term commitment to the industry."

Boral’s Building Products business lost $40 million in the 2013 financial year.

There were no immediate shutdowns proposed, but consolidated of sites would be considered in the future.

The merger would require ACCC approval.

 

Image: abc.net.au

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