DRYMEN-headquartered fuel distribution firm James D Bilsland Ltd has acquired Kilmarnock-based Andrew Gray & Co Fuels Ltd for £2.8 million, supported by a £1.6m term loan from Bank of Scotland.

James D Bilsland is a family business set up in 1964, with just one lorry delivering tractor diesel and vaporising oil to local farmers. It now has a turnover of £16m and employs 30 people. Andrew Gray & Co Fuels, established more than 80 years ago is a leading distributor and supplier of fuel products, employing 19 people.

The two companies will operate 36 lorries from eight depots, located in Oban, Rothesay, Drymen, Kilmarnock, Douglas, Carlisle. The combined turnover will be more than £25m. The firms will retain separate brand names. Last year, James D Bilsland expanded its operation into renewable energy, with the support of a £600,000 term loan from the Bank of Scotland, now also producing and supplying wood pellets and wood chips.

The funds also supported the installation of a CHP biomass unit at the firm’s head office, which is expected to save the business £2million in electricity and heating over the next 20 years.

James Bilsland, managing director of James D Bilsland, said: “There is a strong synergy between the two businesses. We’re both family businesses and we share many of the same values. The acquisition makes sense on many levels, but also enables us to cover additional geographies, taking us into Ayrshire including the Isle of Arran.”