Construction company SigmaRoc PLC (LON:SRC) has entered a conditional agreement to acquire CDH Développement SA to expand in the Benelux market.

CDH is Europe’s largest bluestone and limestone quarry and supplies half of the global market with 1.5mln-2mln tonnes produced per year.

The equity cost is €45.1mln, although including debt the consideration rises to €81.3mln, which is more than SigmaRoc’s current market value.

CDH, which recorded €45.9mln in revenue and €12mln in underlying earnings in the year to 30 June, is expected to increase SigmaRoc’s earnings by a “double-digit percentage”.

The AIM-listed firm said it plans to raise £32.8mln through a placing of new shares at 41p, which will be used to pay the first instalment of the transaction and the remainder “for future investment opportunities and general working capital”.

The second and third instalments, set at €2mln and €14mln, will be settled within two years after the initial payment.

“This acquisition, which is consistent with our strategy of growth, provides us with an exciting opportunity to substantially strengthen our existing presence in Belgium, one of the highest infrastructure densities in the EU,” said chief executive Max Vermoken.

“CDH is over 130 years old, has over 150 years of remaining reserves and is Europe’s largest dimension stone quarry and one of Belgium’s largest construction aggregate producers.”

Sigmaroc shares were up 5% to 43p on Tuesday afternoon.