A MAJOR force is being established in the UK building materials industry through the agreed merger of Bardon, which owns the John Fyfe operations in Scotland, and Camas.

The company, which will be called Aggregate Industries, will have combined reserves of 2200 million tonnes of consented mineral reserves and would have had - on a merged basis - turnover last year of #656m. It will be the fifth largest in the aggregates industry after Tarmac, RMC, Hanson and Redland.

This is the second attempt to put the companies together with the first having been abandoned a year ago because of reported differences between Camas chief executive Alan Shearer and his Bardon counterpart, Peter Tom.

That has been resolved with the ebullient Mr Tom having won the power game to become chief executive of the combined group and Mr Shearer departing with a pay-off of around #200,000.

The chairman will be Camas' Maurice Warren.

The deal is being affected by a reverse takeover in that the slightly smaller Bardon is offering two of its own shares for each Camas although Camas shareholders will have 52% of the total equity. Camas is the former aggregates business of English China Clays, which was floated in 1994.

Its major areas of operation are in Southern England although it has activities in Scotland based at Chryston, Glasgow.

Bardon's John Fyfe subsidiary has as it main asset the developing #10m Duntilland quarry near Shotts on the M8 in Lanarkshire. But it is also the second largest building materials supplier in Scotland and has increasingly raised its profile in the Central Belt from its origins in the north-east.

Bardon takes its name from the Bardon Hill quarry in Leicestershire.

The merger also creates one of the largest aggregate companies in the US in an industry which is highly fragmented. Bardon Trimont is the market leader for crushed stone in Boston, Massachusetts, while Camas is prominent in both Colorado and Minnesota.

Last year, Bardon came in with much as expected pre-tax profits of #23.4m on turnover of #318m while Camas returned a similar #22.8m, down from #24.1m.

One of the major reasons for the merger is that there will be annualised savings of about #10m. That arises in part from being able to serve customers on a UK basis, the cutting of central overheads and stronger purchasing power.

Market reaction was positive with Camas jumping 9p to 93p while Bardon was 3p better at 44!sp.

The City liked the logic of the deal at a time when quarry product and concrete block prices have been rising by up to 8% in some areas thanks to the improving level of housing starts.

It is a continuation of moves seen elsewhere in the industry such as Tarmac swapping its housing activities in return for the Wimpey quarry and aggregate interests.