Meyer to pay pounds 269m for Graham builders' stores
Tuesday 10 August 1999
Meyer has received undertakings to accept the offer from the directors of Graham and other shareholders owning a total of 32.2 per cent of the firm. Graham shareholders will receive a mix of cash and shares valuing each stock at 192.4p.
Alan Peterson, Meyer chief executive, said he expects about 150 job losses. Most are likely to come from Graham's base in Huddersfield, Yorkshire, but other administrative functions run by Jewson in Glasgow, Norwich and Coventry could see staff come under threat.
There may also be around 20 closures in the enlarged store network, which will include Graham's 169 branches and Jewson's 378. About 10 staff are employed at each branch, but redundancies were unlikely as staff will be moved to nearby outlets, Mr Peterson said. Graham employs 3,400 staff, while Meyer has 9,500, mostly in the UK.
Analysts expect to see cost savings of about pounds 15m from the deal.
The Graham brand will be kept for most stores. Mr Peterson said: "The building trade is very conservative - they like to stick with the same brands. Graham has a stronger name in plumbing, so we will probably initially only see around 50 of its stores Jewsonised."
He said he hoped Meyer's stock value, now pounds 740m, would exceed pounds 1bn after the deal, taking it out of the small-to-medium company sector currently unfashionable in the City.
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