Acquisition
Wolseley PLC
4 July 2002
4 July 2002
NEWS RELEASE
WOLSELEY plc
WOLSELEY ACQUIRES WASCO GROUP FOR €58 MILLION (£38M)
HOLLAND'S LEADING HEATING EQUIPMENT AND SPARES DISTRIBUTOR
Wolseley plc, the world's largest specialist trade distributor of plumbing,
heating and building material products, has acquired for cash all of the issued
shares of Wasco Group of Holland, for €58 million (£38m), including debt. Wasco
is the market leader in Holland in the sale of heating equipment and spares.
The family-owned business was established in 1970 and is headquartered in
Twello, approximately 64 miles east of Amsterdam.
Wasco is currently structured in 3 divisions - Wasco (Merchants), WEC (Wasco
Energy Centers) and CV Onderedel (Spare Parts), with 9 branches located around
Holland. Approximately 55% of turnover is the sale of boilers and radiators;
30% is valves and fittings and 15% in heating spares.
Wasco offers Wolseley an opportunity to significantly grow the business in
Holland, deploying the expertise of local management under the guidance of
Andrew Hutton and his Northern European management team. Particular emphasis
will be placed on expanding the sanitaryware business and opening new collect
centers, to service small professional contractors. Wasco's spares business
will also be developed utilising its recently established 110,000 square feet
spare parts distribution facility.
It is anticipated that this development of the business will enable Wasco to
achieve Wolseley's target return on capital of 20% in the third year following
the year of acquisition. It is also anticipated that Wasco will provide the
platform for further bolt-on acquisitions in Holland.
For the year ended 31 December 2001, Wasco reported turnover of €114.5 million
(£74.4m), with a trading profit before interest and tax, of €2.8 million
(£1.8m). After taking into account possible fair value adjustments, it is
estimated that goodwill of approximately €11 million (£7m) is likely to arise on
the transaction.
The acquisition of Wasco will bring Wolseley's cumulative acquisition spend for
the financial year to date to approximately £140 million, with goodwill of
around £70 million.
Charles Banks, Group Chief Executive of Wolseley said:
'We are delighted to announce the acquisition of Wasco, which sees our entry
into Holland. It is an excellent business, which provides us with a platform for
future growth in a new European market. We intend to continue with the process
of change, which has already begun in Wasco, by increasing the number of
branches and focusing on a wider range of products and customers. This
acquisition is in line with our strategy to expand the business through a
combination of organic growth and bolt-on acquisitions.'
-Ends-
Enquiries:
Wolseley plc
Steve Webster, Group Finance Director Tel: + 44 (0)118 929 8700
Jacqueline Sinclair-Brown, Director of Corporate Communications
Brunswick Group
Sophie Fitton Tel: + 44 (0) 20 7404 5959
Notes to Editors:
Wolseley plc will issue a pre- close trading update on 24 July 2002 and
Preliminary Results will be announced on 24 September, 2002.
An exchange rate of €1.54 /£1.00 has been used throughout this news release.
Wasco Holding B.V.
The merchant division has 9 branches. The branches are located in Groningen,
Alkmaar, Amsterdam, Rotterdam, Eindhoven, Maastricht, Enschede, Zwolle and
Twello. The company employs 180 staff. Wasco is a traditional merchant
supplying the professional trade with plumbing and heating equipment. It also
has a specialist spare parts division in Twello with outlets in the merchant
branches.
Wolseley plc
Wolseley plc is the world's largest specialist trade distributor of heating and
plumbing products. Last year the group sold over £7 billion worth of heating
and plumbing products, building materials, lumber products, pipes, valves and
fittings. Wolseley is listed on the London and New York Stock Exchanges and is
in the FTSE 100 listed companies.
The group distributes pipes, valves, fittings, central heating equipment, and
other building materials from more than 2,750 outlets in Europe and North
America.
Wolseley plc's European Distribution division reported sales of £2.4 billion for
the year ended 31 July 2001 and operates from more than 1600 locations across
Europe.
This information is provided by RNS
The company news service from the London Stock Exchange
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