:: BORAL's First 60 Years ::



	In the early 1980s, Boral had the sand and aggregates but did not have its own cement supply, an important component of concrete, as did other major construction companies. Boral was at a significant disadvantage if it did not control its own cement production because major competitors with their own cement could afford to drop their prices below Boral's. Cement was the key to Boral's future in the concrete and quarrying business. Boral had been watching Blue Circle Southern Cement for seven years. The company had been established in 1974 with the merger of Associated Portland Cement Manufacturers - the Australian subsidiary of a UK company - and Southern Portland Cement, which was owned by BHP. Blue Circle Southern Cement, was a partnership between the two. BHP owned 42 per cent, the same as the English company Blue Circle Cement PLC. Boral's management felt that a cement company wasn't BHP's area of interest and that the English company probably did not consider it a long-term proposition. From 1980, Neal maintained contact with Brian Loton of BHP and Sir John Milne, the managing director of Blue Circle Cement PLC. Both Brian Loton and John Milne had politely acknowledged Boral's advances, said they had no present intention of selling, but noted Boral's interest. Nevertheless, Neal maintained contact with both, calling on Milne each time he went to England and meeting with, or telephoning, Loton at least once a year to touch base. In 1987, Neal finally received a call from BHP to say that they had decided to invite bids for their shareholding in Blue Circle. It was clear to him that if they were inviting bids for a 42 per cent share in a company, the best course was to make a takeover bid for all the shareholders. Boral offered them $5 a share, which was below market price. Neal recalls, 'The day before our offer ran out, Geoffrey Heeley from BHP and a Blue Circle Cement representative came to my office in Sydney and we agreed on a slightly higher price, on the basis that if we increased the offer both BHP and Blue Circle Cement would sell.' Boral increased the offer and moved from a few per cent to 85 per cent that afternoon. This move into cement took Boral into a different world and the company culture changed. Bruce Kean who succeeded Neal as Boral's chief executive in 1987 recalls, 'Boral's resource managers had always seen cement as the devil, and all of a sudden this devil was inside their camp. The internal friction it created was unbelievable because Boral was now selling cement to independent distributors. Up until the takeover of Blue Circle Southern Cement, Boral had been able to introduce its name into most of its acquisitions quite easily. But to offer Boral concrete as well as Boral cement, and to have green and gold trucks entering competitors' yards, was virtually unthinkable.' Blue Circle, although it is now part of Boral, operates under its own name. Jim Layt, Blue Circle's managing director before the takeover, stayed on to manage the company for Boral after the acquisition.
	The History of Blue Circle Southern Cement Southern Portland Cement Limited had been incorporated in 1927 by Hoskins Iron and Steel Company Limited. This new wholly owned subsidiary mined limestone at Marulan in New South Wales for the parent company's Port Kembla steelworks. However, not all the limestone excavated was suitable for steel production, and it was decided to use this excess material to manufacture cement. A plant was erected at Berrima, close to the coal and shale deposits required for cement production. In 1928, Hoskins Iron and Steel formed a new company, Australian Iron and Steel, to acquire the undertakings of Hoskins Iron and Steel and its subsidiaries, as well as an associated structural engineering business, Dorman Long and Co. In 1935, after suffering during the Depression years, the Hoskins family merged its steel operations with Broken Hill Proprietary Co. (BHP) and Australian Iron and Steel and Southern Portland Cement became subsidiaries of BHP. In 1945, brothers Ken and Don Hoskins entered into a partnership with an initial investment of 15,000 pounds on a small leased area within Southern Portland Cement's works at Berrima. They undertook a contract with the company to manufacture agricultural limestone, with provision for spreading the product on farms. Under the agreement this enterprise's marketing and development was to satisfy the cement company at all times. By meeting these contractual requirements, the new company was assured a considerable degree of assistance from Southern Portland Cement. And in the postwar years, many essential services were provided by the parent company so that a close and cooperative association developed.

	Using a simple homemade crusher with bin and bagging facilities, Southern Limestone was capable of despatching 100 tons of limestone a day. The company built a lime spreader that delivered to local farms and the company soon had a fleet of fifteen of these units which operated throughout New South Wales. By 1949 output had increased to 20,000 tons and the company was incor¬porated as Southern Limestone Pty Ltd. Important new markets developed in 1950. Firstly, road making used an increasing volume of limestone filler; secondly, CSR began producing floor tiles, which required a special grade of limestone; and thirdly a modest start was made to supply higher-grade limestone - which the plant could now process - to the glass industry. Despite these developments in the early 1950s, expansion was severely hampered by postwar shortages. Electricity, rail trucks and paper bags were all in short supply; even telephone calls to Sydney were rarely connected in less than an hour. At the time, electricity was perhaps the most critical factor for Southern Limestone. The County Council electricity supply was unreliable and costly. Southern Portland Cement's powerhouse was fully stretched in meeting the combined needs of the Berrima cement works, the Marulan quarry (which was connected by a private railway line) and the modest needs of Southern Limestone. Due to these restrictions, Southern Limestone was quoting six to nine months' delivery for its limestone. This situation soon encouraged other producers to appear in country areas, particularly the north coast of New South Wales where there was increasing demand for the product. Associated Portland Cement Manufacturers was originally incorporated as a proprietary company in 1960. In 1964 it had been converted into a public company in order to acquire the Australian interests of the UK-based Blue Circle Group of companies. In January 1974 BHP, who owned Southern Portland Cement, and Associated Portland Cement Manufacturers agreed to merge their interests. This entity became Blue Circle Southern Cement.		A view of Blue Circle Southern Cement's Berrima plant in 1932. .
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