THE biggest chain of builders merchants in East Lancashire looks set to snap up a smaller rival in a £269 million deal.

Meyer International - the firm behind the Jewson name - has announced it has struck an agreed deal to take over Graham Group.

The move will make Meyer's Jewson operation Britain's biggest timber and builders' merchant by turnover. The firm operates depots in Blackburn, Burnley and Nelson.

Meyer has already received undertakings to accept the offer from the directors of Graham and other shareholders owning a total of 32.2 per cent of the company.

Graham's shareholders will receive a mixture of cash and shares valuing each of their stocks at around 192.4p.

Meyer chief executive Alan Peterson said he expected to see around 150 job losses from the deal.

Most are likely to come from Graham's base in Huddersfield, but other administrative functions run by Jewson in Glasgow, Norwich and Coventry could see staff come under threat.

Graham employs 3,400 staff, while Meyer has 9,500, mostly in the UK.

The Graham brand will be retained for the lion's share of the stores.

He added that he hoped Meyer's stock market value, currently at £740 million, would top the £1 billion mark after the deal. This should take it out of the small-to-medium sized company sector currently unfashionable in the City.

The two sides had been in talks for some months, although serious discussions only started over the last 10 days.

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