Travis Perkins have announced a serious move into online supply and retail with the acquisition of Toolstation, which supplies tools, fixings, hardware, electrical and plumbing and heating materials to retail and trade customers.
The phased purchase has commenced with Travis Perkins acquiring 30% of Toolstation’s equity with the right to purchase the remaining 70% after four years.
The initial consideration is £5m for the 30% plus a loan of £7m to allow Toolstation to repay its outstanding early stage capital loan. TP will then provide a loan facility of up to £30m to facilitate the growth of the company. A statement released by the company this morning says that the company expects that the cash generated from trading over the next six years will repay any drawings on the loan facility.
Toolstation was setup in 2003 by former Screwfix executives when the brand and business was aquired by B&Q parent company Kingfisher. Since its launch, the company has grown to employ 244 people, operate from 11 trade counters and a successful catalogue and online operation. Turnover in the past 12 months was £21.4m.
Travis Perkins chief executive Geoff Cooper, said “This investment represents a significant advance in the development of our multi-channel strategy. Our customers increasingly expect products from us through a variety of distribution channels, delivered to them or collected by them via a time, place and mechanism that suits their needs. The experienced Toolstation team have already developed one successful business in this market and we are delighted to be working with them with the aim of creating the market leader using their skills and our scale and resources.”