The Board of Victoria, a manufacturer, supplier and distributor of design-led flooring, is delighted to announce that it has agreed to acquire the entire issued share capital and shareholder indebtedness of Interfloor Group Limited, the UK market-leading manufacturer of carpet underlay and related accessories, for a total enterprise value of £65.0 million from Milestone Capital, Hutton Collins Partners, and management.
As part of this transaction, Victoria is also pleased to advise that Cantor Fitzgerald Europe has placed 2,504,223 new ordinary shares of 25 pence each in the capital of the Company (the “Vendor Placing Shares”) at a placing price of 1230 pence per Ordinary Share (the “Placing Price”. £30.8 million has been raised by the sale of the Vendor Placing Shares (the “Vendor Placing”) to fund the cash consideration due to the sellers under the Acquisition.
Cantor Fitzgerald Europe has placed a further 402,633 new ordinary shares (the “Firm Placing Shares”), at the Placing Price, on behalf of the Company, to raise a further £4.95 million (the “Firm Placing”). The net proceeds of the Firm Placing will be used by the Group to part fund the Acquisition.
In addition, Cantor Fitzgerald Europe has conditionally placed 711,035 new ordinary shares (the “Conditional Placing Shares”), at the Placing Price, on behalf of the Company to raise £8.75 million (the “Conditional Placing”). The Conditional Placing is being undertaken to satisfy the significant institutional demand identified in response to the Acquisition. The net proceeds of the Conditional Placing will be used by the Group to augment working capital.
The 3,617,891 new ordinary shares, representing the Vendor Placing Shares, the Firm Placing Shares and the Conditional Placing Shares, are being placed with certain existing and new institutional investors.
The Board believes that the Acquisition will:
– be immediately and materially earnings enhancing for the enlarged Group;
– be complementary to the Group’s other subsidiary businesses;
– continue Victoria’s strategy of growing its business with earnings enhancing acquisitions; and
– enable Interfloor to deliver strong longer term growth as part of the enlarged Group.
For the year ended 30 May 2015, Interfloor recorded net sales of £72.29 million and EBITDA of £10.02 million.
Geoff Wilding, Chairman of Victoria PLC commented:
“We believe that Interfloor, as the market-leader, will be an excellent addition to the Group, bringing the complementary established underlay brands of Tredaire and Duralay in alongside our growing portfolio of well-respected carpet and hard-flooring brands. In the UK, Interfloor and Victoria share many of the same customers and there will be significant opportunities to capitalise on this.
In line with our other recent acquisitions, the Acquisition will be materially earnings enhancing and value creating for shareholders. Working in conjunction with the very experienced operational management team at Interfloor, we expect to be able to drive operational efficiency improvements in future years.
In the Board’s view this is another high quality acquisition and we are pleased to welcome Interfloor to the Group.”