Travis Perkins sets up £557m takeover deal for BSS Group

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The deal will make Travis Britain's biggest plumbing and heating trade and retail distribution business.

Travis is offering BSS shareholders 232.91p in cash plus 0.2608 in new shares for each old BSS share, equivalent to 435.8p per share.

The offer is a third more than BSS's closing share price on May 27, the last day of unaffected trade before the two firms announced they were in merger talks.

"Our respective businesses are complementary and we look forward to working with BSS's customers, suppliers and employees," said Travis Perkins chairman Robert Walker.

The company said that it expects to save at least
£25 million a year in pre-tax cost cutting from the deal by 2013, with about £19 million coming from better terms with suppliers due to stronger buying power and another £6 million from overheads.

But Travis said there will be only a "negligible" impact on jobs. BSS employs around 5000 people, whilst Travis Perkins' headcount is 14,500.

Andy Brown, analyst at Panmure Gordon, said: "Assuming that the deal goes ahead at this price, then we think Travis Perkins will have done a good deal, buying a great business."