McLauchlin & Harvey, one of the largest construction companies in Northern Ireland, has announced the purchase of Scottish builder Barr Holdings for an undisclosed sum.

The County Antrim-based group, which is roughly the same size and carries out the same type of construction work as Barr, is understood to have been in talks with its Scottish rival for at least six months. It is believed Barr's owners were looking for £26m, the approximate value of the group based on its assets.

Bernard Solomons, chairman of Barr Holdings, said: "We received a number of approaches in the past 12 months, which is not surprising given the strong performance of the group. However, we feel that this is not only a tremendous fit between the organisations, but it will also enable Barr to compete more effectively on a wider stage."

Philip Cheevers, managing director of McLaughlin & Harvey, commented: "The Barr Group, with its strong regional presence in Scotland, is an ideal fit with our existing activities and we intend to further grow and develop the Barr business in parallel with McLaughlin & Harvey."

The Barr business, which employs almost 1000 workers in Scotland, has constructed more than 100 Tesco stores and built more than 60 football stadiums, including Celtic Park. It can trace its roots back to the late 19th century, to builder and joiner W&J Barr & Sons, although its expansion into civil engineering and higher-value projects began in the late 1960s.

Former chairman and chief executive Bill Barr, who started building the Barr Holdings business in 1969, stepped down from the board in 2003 but with his two younger brothers still held 66% of the shares. He was also chairman of Ayr United in 2002, when the club made its only major cup final appearance since being founded in 1910, in the CIS Cup against Rangers.

Bill Barr said last night that the deal represented "good onward progress for all concerned". He paid "fulsome tribute to those former colleagues who worked so unstintingly to take the company forward in past decades."

He added: "I look forward to watching the business flourish from the detached perspective of my retirement."

Construction veteran Tony Rush, Barr's chief executive, will also have been in line to get a multi-million-pound pay-out for his significant shareholding, as would Royal Bank of Scotland, which had 27% of Barr Holdings.