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(Sharecast News) - Flooring manufacturer Victoria said on Wednesday that it had purchased the assets and business of ceramic tile distributors, Ceramica Colli and Vallelunga, and the shares of ceramic tile manufacturer, Ceramiche Santa Maria.
Located near Victoria's existing Italian operations, the firm said the "successful, growing brands" also brought "significant additional spare production capacity" to the group.
"As a result, they will not only provide an immediate earnings contribution to the group in their own right, but will enable continued profitable growth at Victoria's already established Italian business through the utilisation of that spare production capacity," said the firm.
Total consideration for the businesses was €35.0m and will be funded from Victoria's existing resources.
The acquisitions were projected to add no less than €10.0m in underlying earnings over the next 12 months. Once full integration is completed, the earnings contribution was then expected to increase further, largely come from the insourcing of tile production.
Chairman Geoff Wilding said: "International demand for the ceramic tiles produced by our Italian business continues to grow at a remarkable rate due to the successful blend of quality, style, and value. The use of a high proportion of recycled raw materials in the tiles has proven attractive to consumers.
"However, maintaining service levels for our customers has, in recent months, required the business to outsource production to third parties to meet the ever-increasing demand. This is expensive in terms of margin forgone - and is addressed by this acquisition."
As of 0945 BST, Victoria shares were up 1.65% at 904.70p.
28 Mar 2024 08:28
IN BRIEF: Victoria appoints Roberto Moreno as chief strategy officer
Victoria PLC - Kidderminster, England-headquartered designer, manufacturer and distributor of flooring - Last week Thursday, announces appointment of Roberto Moreno as chief strategy officer. Moreno has 16 years of experience in banking, investing, mergers & acquisitions and corporate value creation and has led Victoria's acquisition-based growth in North America, the company says. Chair Geoff Wilding says: "His leadership and expertise will play a crucial role in advancing our strategic initiatives and operational excellence projects - further solidifying our position as a leader in the global flooring industry."
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