Travis Perkins sells plumbing and heating business
By Kathryn MacColl | 24th May 2021
Building materials firm Travis Perkins, which has six branches in Gloucestershire, is selling its plumbing and heating distribution business to an American private equity firm.
The deal worth £325million will see the P&H arm of the business sold to an affiliate of Miami-based private equity house H.I.G. Capital. It's expected the transaction will be completed sometime in the next three months.
Travis Perkins currently has branches at the Ashville Industrial Estate in Gloucester, Cheltenham Mead Road, Leckhampton, Cheltenham, Brick Road, Cheltenham, Middle Wharf, Wallbridge Stroud, and Forest Industrial Estate, Cinderford.
The move forms part of the company's strategy to streamline its portfolio, which it outlined at the end of 2018 and included plans to achieve £20million to £30million in cost savings and boost its general merchanting arm.
Chief executive Nick Roberts said: "Today marks another important step on our journey to becoming a simplified group, focused on our market-leading trade businesses.
"A significant amount of work has gone into improving the P&H business over the last few years and I am sure that the business will continue to make excellent progress under the ownership of HIG."
He added: 'Following on from the demerger of Wickes in April 2021, the group has now executed the planned actions to simplify its portfolio, and the strength of the group's balance sheet enables us to return the net proceeds to shareholders.
"Looking forward, the group has a bright future as the leading provider of building products in the UK, and we look forward to setting out our plans later in the summer to continue to drive growth.'
A recent trading update from the business revealed demand from the domestic repair and maintenance market remained strong in the first quarter of the year. Commercial and new-build markets were "subdued", but showed signs of recovering.
The builders' merchant said the cost of raw materials, including timber, copper and steel, had increased "over and above" what it experienced in the second half of 2020.
Copyright 2021 Moose Partnership Ltd. All rights reserved. Reproduction of any content is strictly forbidden without prior permission.