Breedon acquires Lagan Group in £455mn deal
British construction company Breedon Group has announced that it has acquired fellow industry operator Lagan Group in an attempt to bolster its position in the UK and Irish construction market.
The deal, valued at £455mn, will be financed by a combination of a £150mn loan, £170mn in Breedon equity, and through the establishment of a new £350mn revolving credit facility, replacing the company's existing £300mn revolving facility.
“Over the last eight years we have pursued a successful buy-and-build strategy which has
established Breedon as the largest independent construction materials business in the UK and
the acquisition of Lagan is another strategic step for us,” said Peter Tom, Breedon's Executive Chairman.
The purchase of Lagan marks Breedon's largest acquisition to date, significantly expanding its operations, particularly throughout Ireland.
“Lagan represents a unique opportunity to enter a growing market with immediate scale and
excellent opportunities for expansion,” said Pat Ward, Executive Chairman of Breedon.
Breedon will acquire Lagan's portfolio that icludes nine active quarries, a cement plant, 13 asphalt plants and nine ready-mixed concrete plants.
With a team of 750 employees, Lagan generated revenues of £249mn in 2017, with operating profits of £46mn.
Which countries are leading the adoption of BIM?
Building Information Modelling (BIM) was first used by UK construction firms in the 1980s. Since then an increasing number of countries such as Germany, Austria, and Russia have also started to use it, but which country is leading the way?
According to research by PlanRadar, the UK, as of 2021, remains the leader in BIM implementation in construction when compared with other European nations. However, the company’s research shows that there is clear evidence other countries in close pursuit.
As part of the research into the adoption of BIM, PlanRadar examined government policy documents and conducted interviews to find out why BIM is being deployed in each country. The study also allowed the company to gauge construction professionals’ attitudes to digital technology tools in their industry, as well as explore where fast growth rates in BIM are most likely in the coming years. In addition, it looked at which governments have progressed furthest in making construction BIM mandatory.
PlanRadar says the findings are “a useful follow-up to the recently published Construction Manager BIM annual survey”, which pinpoints distinct barriers to adoption in the UK market.
While Britain has long been considered a pioneer in BIM technology, with projects such as the Heathrow Airport reconstruction, it seems that Russia is catching up. Even though its first BIM projects only appeared in 2014, PlanRadar says that the country “is on a steep upward trajectory”. According to the research, no other European country has adopted so many laws on standardisation and the mandatory implementation of BIM in the construction industry.
“Russia is arguably the most eagle-eyed nation for compliance and harnessing advanced BIM tech to drive efficiencies”, the company said.
Germany’s BIM adoption is also rapidly increasing as its government invests in BIM standardisation, skills training, and support for BIM projects, in line with its vision for the future digitalisation of the German construction sector.
PlanRadar research summary
As part of its research into the adoption of Building Information Modelling, PlanRadar has summarised each country. According to the company, here are the summaries for the UK, Germany, Russia, and France.
- The UK has the highest number of construction companies using BIM at level 2 and beyond.
- It remains the leader in the earliest use and implementation of BIM in construction projects.
- Since 2016 all state-funded projects must use at least BIM level 2, and this has led to a surge in awareness and use of BIM in the last decade. For private projects, BIM usage is advised but not mandatory.
- Currently, only 62% of small businesses in the UK actively use BIM, compared to 80% of large businesses.
- Approximately 70% of German construction companies use BIM at different levels. However, the majority are architects and design companies, making use of BIM in the design phase rather than construction and operation.
- Since 2017, BIM has been mandatory for projects worth over €100 million. And from 31st December 2020, BIM became mandatory for all public contracts relating to the building of federal infrastructure.
- BIM technology is used by very large property developers and construction companies that operate in the largest cities such as Moscow, St. Petersburg, Kazan, Ufa, Yekaterinburg.
- When it comes to legislation standardising and mandating BIM, Russia is the clear leader, and today there are 15 national standards (GOSTs) and eight sets of rules for information modelling in the country.
- From March 2022, all government projects are required to use BIM technology, and further legislation is in the pipeline.
- France does not yet have a single BIM standard enshrined in law or regulation, yet 35% of developers in France use BIM for their real estate projects.
- In addition, 50 to 60% of the leaders in the French construction market have switched to BIM, with level 2 as the most common maturity level.
- At the end of 2018, BIM Plan 2022 was launched to encourage construction participants to integrate it into their workflows. Still, construction companies have struggled to agree since there is no single approved BIM standard.
The research report concluded that the adoption of BIM is yet to reach its full potential in Europe. While the UK is currently the leader, countries such as Russia and Germany are evidently forging a clear path and have goals surrounding skills and legal frameworks. PlanRadar says that next year’s European BIM ranking “could paint a very different picture”.