Sigmaroc PLC takes full control at CDH and plans European expansion

PLC () said it is taking control of all the quarrying operations at its CDH business in Belgium.

This will lay the groundwork for a major push into the European aggregates market, added the AIM-listed building materials and quarrying group.

acquired CDH in 2019 and as well as producing highly-prized Belgium Blue Stone, the operation also had a standard construction aggregates arm run by LafargeHolcim. 

Today’s agreement sees Sigmaroc take over those operations, a move that it said puts in a far stronger position to become a large-scale supplier in the Benelux aggregates market.

No cash is changing hands but LafarcgeHolcim will get a minimum of 1.5mln tonnes of aggregates a year until the end of 2024 through a take or pay arrangement.

Sigmaroc added it expects to generate an incremental underlying profit [EBITDA] of €1m per annum, with the potential for more once legacy equipment on-site is replaced.  

All of its quarrying operations in Belgium, including three existing Stone Holdings sites, are now to be rebranded as Granulats du Hainaut (GDH), said Sigmaroc.

Total European production volume will increase to approximately 2mln tonnes per year, said the statement.  

 Max Vermorken, SigmaRoc’s chief executive added:  “When we acquired CDH, we saw the potential to unlock significant added value from the legacy arrangements with LafargeHolcim.

“With the assumption of control over the aggregate production assets, we get one step closer to fully benefitting from the potential CDH has to offer and this intermediary step will allow us to be well prepared to establish ourselves as a major supplier of aggregates in the Benelux market by the end of 2024.”

Liberum raised its share price target to 81p from 73p on the back of the deal to reflect the earnings enhancement.