Builders' merchant buys DIY chain for £950m
Builders' merchant Travis Perkins today unveiled a £950 million deal to buy the DIY retail chain Wickes.
Travis, which sells materials through 740 stores, said the tie-up made sense as two-thirds of Wickes' customers were tradesmen or serious DIY enthusiasts.
The 172-store chain is part of the privately-owned Focus Wickes group, which recently called in an investment bank to examine its strategic options.
Focus Wickes acquired Wickes - then comprising 131 stores - in September 2000. Since then it has grown through store roll-outs, the conversion of Focus stores and the development of the Wickes Extra format.
The Focus side of the business operates from 256 outlets and is the fourth largest DIY retailer in the UK.
The private equity owners of the business - Apax Partners and Duke Street Capital - have pledged to open more Focus stores following the disposal, which is subject to shareholder and regulatory approval.
Focus Wickes founder and chief executive Bill Archer said: "The two divisions are both well-placed to continue their development within separate organisations. DIY continues to be a high-growth and resilient market."
Northampton-based Travis Perkins said it expected the combined group to have a 10% share of the wider UK building materials market.
It added that today's deal would give it exposure to the DIY market while also developing its own strengths as a supplier of materials to the building trade.
It said: "There is a considerable potential for further extension of the Wickes network - Wickes remains under-represented in many large conurbations in the UK."
Since 1998 Travis Perkins has added 461 branches after taking on chains including Keyline, Sharpe & Fisher, Broombys, CCF, City Plumbing and Jayhard.
Travis said it expected substantial savings from the tie-up, in particular from the streamlining of buying and distribution processes. It will put in place a new bank facility of £1.2 billion to fund the deal.
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