Building materials company Grafton Group has agreed a deal to sell its British traditional merchanting business for £520 million (€604 million) to Huws Gray.
The move comes following an announcement earlier in the year that the group was undertaking a strategic review of its business.
Under the deal, UK-based Huws Gray, which is controlled by equity funds managed by Blackstone, will buy Buildbase, Civils & Lintels, PDM Buildbase, the Timber Group, Bathroom Distribution Group, Frontline and NDI. In the year to December 31st, 2020, the business reported revenue of £828.2 million and adjusted operating profit of £18.8 million, with gross assets of £497.2 million.
Grafton will retain £25 million in freehold properties with development potential, and also be responsible for the UK defined benefit pension scheme.
The deal is expected to close early in 2022.
Following the sale, Grafton will continue to develop its Selco Builders Warehouse branch network and its other specialist distribution and manufacturing businesses in Britain.
"The divestment secures future opportunities for all stakeholders as part of an enlarged general merchanting business," said Grafton chief executive Gavin Slark. "This is an attractive outcome for Grafton and is in line with our strategy of deploying our capital resources towards higher growth potential businesses offering superior returns."
