Epwin Group acquires Stormking Plastics

Epwin Group

Epwin GroupEpwin Group Plc, the manufacturer of extrusions, mouldings and fabricated low maintenance building products, supplying the Repair, Maintenance and Improvement (RMI), new build and social housing sectors, has announced the acquisition of the entire issued share capital of Stormking Plastics Limited, for consideration in cash and Epwin Group Plc shares with part deferred and dependent upon the future performance of the business.

The acquisition is reportedly in line with Epwin’s stated strategy to broaden its range of low maintenance building products, its technical capabilities and routes to market. The board believes that Stormking’s product technology has potential for use in a wider range of low maintenance building products, markets and applications. (www.stormking.co.uk).

Total initial consideration of £27m is based upon a six times EBITDA multiple with the initial net cash consideration of £20.25m payable at completion, plus 5,348,804 of Epwin Group Plc shares (representing 3.78% of the enlarged share capital) at 126.2 pence, a price based on the average closing share price over a 28 business day period prior to completion, (the consideration shares). Further consideration of up to £8.0m, dependent upon Stormking’s performance in the year to 28 February 2017 may be achieved and may be settled in the same ratio of cash to shares as the initial consideration. This is payable in May 2017. Both the initial and deferred considerations will deliver the acquisition on a maximum multiple of 6 times underlying EBITDA for the relevant period.

The board announces that despite challenging market conditions in the RMI markets in the second half of the year, the company’s profits for the year ended 31 December 2015 will be in line with market expectations.

Jon Bednall, chief executive officer, Epwin Group said: “I am delighted to announce the acquisition of Stormking Plastics and extend a warm welcome to the Group to the team there. Stormking adds further to the Group’s range of low maintenance building products as well as the plastics materials technologies that we can draw upon. The acquisition represents a further significant step in the development of the Group and is expected to enhance earnings in 2016.”

Gary King and Barry Whitehall, the founders of Stormking Plastics Ltd said: “The decision to finally bring to a close our involvement in Stormking Plastics was never going to be easy, but in Epwin Group we are confident we have found a Group that will allow Stormking Plastics to broaden its offering and continue to see the brand and reputation enhanced. We look forward to watching with interest and to learning of the continued success of Stormking.”

Mark Stokes, managing director of Stormking Plastics, said: “Joining Epwin Group is excellent news for the future of Stormking Plastics, its employees and customers. It will enable us to build on the strong foundations laid over more than 30 years by Gary and Barry and gives us the opportunity to expand our product range as well as develop further routes to market in the future. It is business as usual for everyone at Stormking, now with the knowledge that Epwin is committed to supporting the continued development of the business and maintaining the development of the existing operations.”

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