Wolseley share price: Company to acquire Finland’s Puukeskus

on Feb 12, 2014
Updated: Apr 9, 2020

iNVEZZ.com, Wednesday, February 12: Wolseley plc (LON:WOS) today announced it has agreed to acquire Finnish building materials distributor Puukeskus for an undisclosed sum.

Wolseley’s share price was up 0.9 percent at 3,374p as of 10:06 UTC, valuing the world’s largest specialist trade distributor of plumbing and heating products at £8.97 billion. This compared with a 0.90 percent rise in the Cyclical Consumer Goods & Services sector and a 0.43 percent advance in the blue-chip FTSE 100 index.
In a statement, Wolseley said that it will acquire the company “from funds advised by Triton”.

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Finnish forest products group UPM-Kymmene Corporation (UPM) announced in August 2006 it had completed the sale of Puukeskus to European private equity investor Triton and Puukeskus’s management and would book from the disposal a capital gain of around €90 million for the third quarter of 2006.
Wolseley’s deal includes a portfolio of freehold properties used by Puukeskus. Wolseley, a leading supplier of building materials in the UK, continental Europe and North America, will combine Puukeskus’ 23 branches with its Starkki business in Finland which has 22 branches. Upon completion of the deal some 400 Puukeskus employees will join Wolseley 39,000-strong workforce. Starkki, part of Wolseley’s Nordic business, is a Finnish chain of builders’ merchants with a format based on large stores serving both local building contractors and consumers and small retailers.

The acquisition is subject to approval by the Finnish Competition Commission. Puukeskus closed last year with a trading profit of some £4 million on revenue of £190 million, Wolseley said. By comparison, Wolseley has reported £725 million in trading profit for the year to end-July 2013, up 10.7 percent, on group revenue of £13.15 billion. The FTSE-100 listed company defines trading profit as operating profit before exceptional items and the amortisation and impairment of acquired intangible assets and non-recurring tax credits.

According to Puukeskus’ website, the company founded in 1929 in Helsinki is now Finland’s leading supplier of timber and building materials to both trade and DIY customers.
In November, Wolseley reported solid results for the three months to end-October, the first quarter of its financial year 2014, with underlying revenue at ongoing businesses up 7.4 percent year-on-year and like-for-like sales up 3.5 percent (Wolseley share price: Company closes unprofitable online business).

Wolseley will announce half-year results for its financial 2014 on March 25.
**Analysts on Wolseley plc**
Shares of Wolseley have a consenus rating of “hold” from a total of 24 brokers currently covering the stock. Three analysts have issued a “sell” rating, 10 have rated the stock as a “hold” and 11 have assigned a “buy” rating. The average twelve-month price target among analysts that have issued ratings on the stock in the last year is 3,469.76p.
**As of 10:38 UTC buy Wolseley shares at 3,369p**
**As of 10:38 UTC sell Wolseley shares at 3367p**
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