Tarmac to change hands in £5bn deal

The combined company is now to be bought by Ireland's biggest company, the building supplies group CRH.

The original 2011 deal created Tarmac Lafarge in the UK, with 330 sites and 6,600 employees. It also saw the Tarmac site in Ettingshall, Wolverhampton – its spiritual homes for more than a century – lose its head office status. Instead, headquarters functions were transferred to the Lafarge offices at Solihull, along with a number of office jobs from Wolverhampton.

The Ettingshall site, in Millfields Road, had employed 500 but that is now thought to have fallen to around 100 working at former Tarmac laboratories, concrete and recycling operations.

The combined company is the UK's biggest cement maker but it is now being be bought in a £5 billion sale of assets as part of a merger deal between French parent company Lafarge and Swiss-based rival Holcim.

The disposal of Lafarge Tarmac, which produces 45 million tonnes of aggregates and 7 million tonnes of asphalt a year, will help Lafarge and Holcim secure regulatory clearance for their tie-up. Holcim owns Aggregate Industries in the UK.

Dublin-based CRH, which is Ireland's biggest company, is buying assets covering operations in Europe, North America and emerging markets.

The total deal is worth £4.9 billion and will give CRH the number one market position in the UK in cement, aggregates, ready-mix concrete, asphalt and construction.

Tarmac has become part of the English language since Wolverhampton steel magnate and Conservative MP Sir Alfred Hickman brought the business to the town in 1905. The company was instrumental in the creation of the Thames Barrier, the Merry Hill shopping centre, Canary Wharf tube station in London, the refurbishment of Albert Dock in Liverpool and the Channel Tunnel in the 1980s.

In 1999 Tarmac Group split into two parts which led to the creation of construction and support services group Carillion, also based in Wolverhampton.

The following year the remaining Tarmac business was bought by mining giant Anglo American.

Lafarge Tarmac was formed in January 2013 following the merger of Anglo American and Lafarge's cement, aggregates, ready-mixed concrete, asphalt and asphalt surfacing operations in the UK.

As well as the Ettingshall site and the huge Bayston Hill quarry near Shrewsbury, Tarmac Lafarge runs a readymix concrete plant at Fenchurch Close in Walsall and contracting centres at Baggeridge House in Sedgley and at Apex Road in Pelsall.

Tarmac Lafarge said it currently employs around 780 people across the West Midlands, including its Solihull head office. The CRH takeover is not expected to have a major impact on jobs – chief executive Albert Manifold said: "This transaction represents a significant value creation opportunity for CRH. We are acquiring a quality portfolio of assets, which complement our existing positions."

In order for the Lafarge Tarmac sale to CRH to proceed, the operation's 50 per cent owner Anglo American will first sell its stake in the UK business to Lafarge.

As well as ownership of Lafarge Tarmac, the deal will give CRH a presence in a number of new markets such as Germany and the Czech Republic.

It has been reported that private equity firm KKR is set to pick up any assets which CRH may need to sell in order to address competition concerns.