Tue, 26 Jul 2022 | BUSINESS SALE
Yorkshire-based building products supplier SIG has agreed to acquire Miers Construction Products (MCP) in a deal that could rise to £36.5 million. SIG will pay an initial sum of £28.5 million for the firm, with a deferred cash payment of £1.8 million payable in two years and up to £6.7 million in further contingent payments subject to MCP’s performance during the period to December 31 2023.
If the full £36.5 million were to be achieved, this would represent close to an 8.5x multiple of MCP’s nearly £4.3 million in pre-tax profits for the year ending September 30 2021 (up from £1.2 million a year prior), generated on revenues of £46.7 million (up from £34.3 million in 2020). After tax, the company’s profits stood at £3.4 million, compared to £955,623 a year earlier.
SIG described St Neots, Cambridge-based MCP as a strong strategic fit which broadens its UK offering of high-performance construction fixings and accessories. The buyer added that MCP would fit with its business model of delivering “superior service through deep supplier partnerships and specialist expertise” and will strengthen its existing relationships with end-users in a number of key sectors.
The combination of MCP’s strong global supply chain with SIG’s product range and national supply network are also expected to deliver significant growth opportunities for both firms. Post-acquisition, MCP will continue to trade under its current brand, with its existing management team remaining in place.
SIG CEO Steve Francis said: “We are delighted to announce the acquisition of MCP, which demonstrates delivery of SIG’s Group strategy to grow both organically and through carefully targeted value-enhancing acquisitions. MCP is a highly attractive specialist business with a strong brand, a great reputation for quality service, and technical sector specialism and expertise. These key elements have created a business that has the ability to grow sustainably ahead of the market.”
“MCP illustrates the opportunities to accelerate through acquisition our path to 5 per cent margins in the medium term. We welcome MCP’s knowledgeable and committed management team and employees to SIG and look forward to working with them.”
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