Bird & Bird advise longstanding client LKAB Minerals on its acquisition of Francis Flower

10-2018

International law firm Bird & Bird advised longstanding Swedish client LKAB Minerals and its UK subsidiary in connection with the acquisition, subject to merger clearance, of the business of Francis Flower, comprising two companies Francis Flower (Northern) Ltd and Gurney Slade Lime & Stone Ltd.

Included in the purchase is the substantial Ground Granulated Blast furnace Slag (GGBS) plant operated by Francis Flower on the British Steel site in Scunthorpe. The GGBS business, previously owned by Hanson, was the subject of a divestment order by the Competition & Markets Authority following its investigation into the market for aggregates, cement and ready-mix concrete in the U.K. in 2014. GGBS is an alternative to cement in a concrete mix that delivers decreased CO2 emissions.

LKAB furthermore delivers iron ore pellets to British Steel, making this acquisition a good example of a circular economy where LKAB makes use of the slag from its own iron ore.

The acquisition is a great strategic fit, both in terms of the portfolio of sustainable products it brings but also in the expansion of LKAB Minerals' U.K. presence. The acquisition is subject to receipt of merger clearance from the Austrian competition authority, but no other conditions.

LKAB Minerals is an international industrial minerals group with a leading position in a number of product applications, supplying natural minerals engineered for functionality and usability. LKAB Minerals is a subsidiary of the Swedish company LKAB, one of the world’s leading producers of highly upgraded iron ore products and other related mining services and products.

Francis Flower recycles blast furnace slag from the steel industry for production of ground granulated blast furnace slag for use in cement production. It employs 130 people across four sites in the UK: Scunthorpe, Wicken, Gurney Slade and Runcorn.

Adam Carling, a partner from the London Corporate team at international law firm Bird & Bird, said: "It was a pleasure to support LKAB, both in Sweden and the UK, on this significant acquisition. It was a natural fit given our market leading Energy & Utilities practice. The acquisition forms a central part of their exciting growth plans for the U.K. business. We were delighted to assist."

Jorgen Ekström, a partner from the Stockholm office at international law firm Bird & Bird, noted: "We have worked with LKAB Minerals in Sweden over many years and we advised them on the international acquisition of the minerals division of Frank & Schulte fifteen year ago, which was the beginning of what is now LKAB Minerals. It's been a pleasure to assist them on their further expansion both in terms of location and product line. It's an exciting acquisition for LKAB Minerals, adding this impressive portfolio of sustainable products to their offering. The acquisition exemplifies Bird & Bird's seamless 'one firm' approach to managing cross border transactions. "

Leif Boström, CEO of LKAB Minerals, commented: “Bird & Bird has been a long-standing advisor to LKAB Minerals in various business transactions and legal matters. Their understanding of our business and our fruitful relationship paired with their M&A expertise laid the grounds for a successful Due Diligence and negotiation process. The Bird & Bird team in London and Stockholm coordinated and supported us very well in both technical legal matters as well as provided general guidance and support.”