Sims Metal Management Ltd (ASX: SGM) will expand its presence in the United Kingdom.
Today, the company announced it will acquire the Morley Waste Traders and Lord and Midgley metals recycling businesses, absorbing their personnel and 10 recycling facilities into its Europe Metals segment, in addition to the 40 sites that Sims already operates in the UK.
Today's release doesn't specify the expected impact of the acquisition on the company's revenue, nor its cost, but it seems that the purchase price won't be particularly expensive for Sims.
This move is coherent with Sims' standing as an industry leader with a global presence, but is directed at a market where the company's recent performance has not been particularly strong. While Sims's underlying EBIT grew 60% in the first half of FY 2018 over the previous corresponding period, the UK segment bucked the trend with a 20% underlying EBIT decline, due to lower metal margins in the area.
The announcement left investors cold and after early gains shares in Sims Metal Management are down 0.87% to $15.94.
