Grafton Group plc has confirmed the sale of Plumbase to Plumbing and Heating Investments Limited (PHIL).
Completed on 1 October 2019, Grafton has sold Plumbase to Plumbing and Heating Investments Limited (PHIL) for an “enterprise value of £66.75 million”. A press release stated: “After allowing for adjustments for debt-like items and working capital, net cash proceeds of £60.7m were received on completion.”
The statement continued: “Consistent with Grafton’s recent corporate activity, including the acquisition of Polvo (a specialist distributor of ironmongery, tools, ventilation systems, fixings and related products, based in the Netherlands) on 1 July 2019 for €131m and the agreement to sell the Group’s Belgian operations, this announcement follows a strategic review culminating in a decision to divest Plumbase.
“The disposal of Plumbase is in line with the Group’s strategy of orientating towards higher returning businesses with good long-term growth prospects.”
Trading from a network of over 160 branches, Plumbase was recognised as the country’s fourth-largest plumbing and heating merchant and could trace its roots back more than 150 years. Part of the Grafton Group since 1994 and trading under the Plumbase name since 1998, the business generated sales of £257.8 million and operating profit of £6.0 million for the year ended 31 December 2018.
Gavin Slark, Chief Executive Officer of Grafton Group plc, commented: “The sale of Plumbase to PHIL secures future opportunities for Plumbase, its employees and other stakeholders as part of an enlarged specialist plumbing and heating business. This transaction represents a very positive outcome for Grafton and enables us to continue to focus our capital and resources on attractive growth opportunities that generate appropriate returns for our shareholders.”
Plumbing and Heating Investments Limited is a sister company of Knutsford-based electrical wholesaler, Edmundson Electrical and already lists Plumbcity, HPS and GB Willbond amongst its specialist merchant brands.