Acquisition of highly scalable wet wipes business
9 April 2021
ACCROL GROUP HOLDINGS PLC
("Accrol", the "Company" or the "Group")
AIM: ACRL
ACQUISITION OF HIGHLY SCALABLE WET WIPES MANUFACTURER
Accrol Group, one of the UK's leading independent tissue converters, is pleased to announce that the Group has completed the acquisition of John Dale Limited ("John Dale"), a highly scalable flushable and biodegradable wet wipes business, for a total cash consideration of £3.9 million, funded from the Group's existing cash reserves.
Acquisition rationale
The acquisition of John Dale is a strategic move into high growth products within the wet wipes segment of the tissue market, providing a well invested platform on which to build a sizeable business.
Highlights
· John Dale has a long-established and unrivalled reputation as a privately-owned manufacturer of high quality own branded and private label wet wipes and facial tissues for the UK retail market
· Accrol and John Dale share several customers, but John Dale also brings a number of significant new accounts into the Group
· The product range includes flushable and biodegradable moist toilet wipes, anti-bacterial and anti-viral wipes, facial cleansing wipes, baby and toddler wipes and feminine hygiene wipes
· The addition of incremental volume to the Accrol facial tissue business will serve to leverage the Group's existing production facility in Blackburn
The business currently operates a single daily shift, five days a week, from its owned premises in Flint, North Wales, which is currently generating annualised revenue of c.£6.0 million and EBITDA (normalised) of c.£0.6 million.
Following acquisition, Accrol's primary areas of focus will be the expansion of the anti-bacterial and anti-viral wet wipe ranges and optimisation of production facilities.
The acquisition includes the 47,000 sq.ft. property from which the business operates. Both the business and the property were purchased from John and Pauline Dale.
Dan Wright, Executive Chairman of Accrol, said:
"I am delighted to announce the purchase of the John Dale business in Wales. A move into the attractive wet wipes' segment has been on our radar for some time; as a natural extension of our product range and wholly in line with our growth strategy across the household products category. It was essential, however, for us to find a business with a disruptive and environmentally friendly product which we could scale through organic investment. John Dale fits our criteria for growth - quality of product and market positioning, operating excellence in its asset base, and the optimisation of our distribution strengths. It gives Accrol a ready-made platform on which to build a sizeable wet wipes operation and presents an unmissable opportunity for us to compound shareholder value."
Gareth Jenkins, CEO of Accrol added:
"John Dale is an excellent business, with three modern wet wipe machines, which are significantly under-utilised. The UK wet wipe market is valued at £0.5bn. We are confident that, with our wide customer base, market and operational know-how and a modest investment in additional machine assets, we can scale this business significantly, while generating strong margins, over the next two to three years. The slack within the property and working capital assets of the business will fund much of this growth and accelerate financial returns."
|
For further information, please contact: |
|
|
|
|
|
Accrol Group Holdings plc |
|
|
Dan Wright, Executive Chairman |
Via Belvedere Communications |
|
Gareth Jenkins, Chief Executive Officer |
|
|
|
|
|
Zeus Capital Limited (Nominated Adviser & Broker) |
|
|
Dan Bate / Jordan Warburton |
Tel: +44 (0) 161 831 1512 |
|
Dominic King / John Goold |
Tel: +44 (0) 203 829 5000 |
|
|
|
|
Liberum Capital Limited (Joint Broker) |
Tel: +44 (0) 20 3100 2222 |
|
Clayton Bush / Edward Thomas |
|
|
|
|
|
Belvedere Communications Limited |
|
|
Cat Valentine |
Tel: +44 (0) 7715 769 078 |
|
Keeley Clarke |
Tel: +44 (0) 7967 816 525 |
|
Llew Angus |
Tel: +44 (0) 7407 023 147 |
|
|
accrolpr@belvederepr.com |
Overview of Accrol
Accrol Group Holdings plc is a leading tissue converter and supplier of toilet tissues, kitchen rolls and facial tissues to many of the UK's leading discounters and grocery retailers across the UK. Following the recent acquisition of a state-of-the-art tissue converter based in Leicester, the Group now operates from five sites, including four in Lancashire, which generate revenues totalling c.16% of the £1.7bn UK retail tissue market.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.
Latest directors dealings
- 56 minutes ago Judges Scientific
- 1 hour ago AB Dynamics
- 1 hour ago Henry Boot
- 1 hour ago TPXimpact Holdings
- 1 hour ago Ithaca Energy