Construction services group Siteserv has acquired utilities service provider Sierra Communications for an initial 46 million (£31.1 million) sum.

The consideration comprises 41.4 million cash with the remainder satisfied through the issue of more than 7.7 million shares at 0.59 each.

The acquisition was funded through existing resources and additional borrowings of 42.9 million. Further payments, capped at 6 million, will be made based upon the financial performance of the acquired business to July 2010.

Siteserv’s chief executive, Brian Harvey, said: “The acquisition of Sierra fits within the Siteserv strategy to develop into a broadly based site services group and re-emphasises our plans to grow the company both organically and through acquisitions.”

In the year to July 2007, Sierra had a 52.3 million turnover and earnings before interest and tax of 7 million. Net assets at completion are expected to be some 5.3 million.

Sierra, which was established in 1979, provides services to the power, telecommunications and civil engineering markets in Ireland and the US.