Telford brickworks site sold to housebuilder for £4.6m

Michelmersh Bricks, which trades as Blockleys in Telford, has sold the site around its works off Sommerfield Road in Hadley to the builder for £4.6 million.

The scheme will see 185 homes, pond, park and play area created, along with the possibility of allotments being on the site in the future.

Work is expected to run over the course of the next eight years.

Michelmersh chief executive Martin Warner said the sale would benefit the brickmaker.

Works ceased on the vacant part of the site in 2011 but the company still manufactures about 24 million bricks, paving stones and special shaped products each year.

Mr Warner said: "Completion of the sale of this land is extremely satisfying and is a sound reward for the hard work of our planning and development team. We now move on to address other land assets and maximise their value to the group.

"We are, however, principally a brick manufacturer and we continue to compete strongly in a market that is showing signs of price recovery.

"The upturn in demand we have seen over the past few months is encouraging us to invest in our existing plants to increase capacity and efficiency, which will, in due course, increase Group revenue."

The money will be paid to Michelmersh as £1.6m immediately, with a further £3m in equal instalments on the first and second anniversary of the completion of the deal.

The proceeds will be used to reduce the group's borrowings and meet the cost of the site re-organisation and taxes arising from the sale.

Its profits fell to just £9,000 last year on revenue of £24.5m, while in the first half of the current financial year the firm reported a £2.4m pre-tax loss as a result of restructuring costs.

The firm is also providing bricks for the rebuild of Ercall Wood Technology College.