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Wesfarmers eyes $1bn-plus Buckeridge Group of Companies

The late Len Buckeridge founded BGC more than 50 years ago, creating one of the largest private business empires in the country. Picture: Stewart Allen

• BRIDGET CARTER
  DATAROOM EDITOR
  
• 5:30PM OCTOBER 31, 2021

There is persisting talk in the market that Australian Pharmaceutical Industries is not Wesfarmers’ only takeover target, but the $1bn-plus Buckeridge Group of Companies as well.

Talk started to surface in early August that Wesfarmers was taking a look at the West Australian building materials company, but if that was the case, it was only in the early stages and not under consideration by those in the top ranks.
Now there is discussion that the Perth-based conglomerate may be closing in on BGC, which is also based in the west.

Wesfarmers is on the acquisition trail, being cashed up after selling down stakes worth $2bn in Coles supermarkets at the onset of the pandemic last year.
It bid $1.57 per share or $773m for Priceline owner API in October.
But although it has control of a 19.3 per cent stake, it remains in contention for the company with Sigma, which has put forward a rival cash and scrip offer, valued at $1.57 per share at the time.


But with the residential construction market soaring in Western Australia as the state prospers from the mining boom, the time may now be right to sell.
Macquarie Capital has been appointed for some time, but sale plans have been pushed back for various reasons, including the pandemic.
The official line in recent weeks has been that no sales process has been running.

Private equity groups including Blackstone and The Carlyle Group have run the ruler over BGC in the past, along with Irish building materials company CRH.

BGC could make sense for Wesfarmers because it may create opportunities to lure more trade customers to its Bunnings hardware stores.

The Buckeridge group is one of the largest privately held businesses in Australia and was placed up for sale following the death of its founder Len Buckeridge.

Parts of the business have already been offloaded, including its contracting arm, which was picked up by NRW for $310m including debt.
Earlier valuation estimates of the remaining portfolio were more than $1.5bn.
It was earlier thought BGC had an annual turnover of at least $3bn, but this included its mining services and development arms.

The late Len Buckeridge founded BGC more than 50 years ago, creating one of the largest private business empires in the country.
The billionaire died in 2014 at the age of 77, leaving a $2.5bn fortune.

The business is now involved with producing construction and building materials and offering residential and commercial construction services, industrial maintenance and fabrication services, and property ownership and management.
It owns quarries and a highly attractive cement grinding plant.

Family members have been involved with running the business, but some believe they could be taking more of a backward step in future.
It is thought that the group’s divisions are all interrelated and are largely reliant on each other for profitability.