Travis Perkins Regulatory News (TPK)

21 May 2021

Travis Perkins plc

Disposal of Plumbing & Heating business

Travis Perkins plc today announces the disposal of its Plumbing & Heating distribution business ("P&H") to an affiliate of H.I.G. Capital, a leading global alternative investment firm, for cash consideration of £325 million, on a debt-free, cash-free basis and subject to customary adjustments. The transaction is expected to be completed within the next three months.

Alongside the recent demerger of Wickes, the sale of P&H represents the completion of the Group's portfolio actions as outlined at the Capital Markets Day in December 2018.

Given the Group's strong balance sheet and robust liquidity position, Travis Perkins intends to return the net proceeds of the disposal to shareholders following completion of the transaction through a combination of a 35 pence per share special dividend and, subject to market conditions, a share buyback programme.

Nick Roberts, Chief Executive, commented:

"Today marks another important step on our journey to becoming a simplified Group, focused on our market leading trade businesses. A significant amount of work has gone into improving the P&H business over the last few years and I am sure that the business will continue to make excellent progress under the ownership of H.I.G.

I would like to thank all of our colleagues in the P&H business for their commitment and hard work whilst part of the Travis Perkins Group, particularly during what has been an extremely challenging year, and I wish them all the best for the future.

Following on from the demerger of Wickes in April 2021, the Group has now executed the planned actions to simplify its portfolio and the strength of the Group's balance sheet enables us to return the net proceeds to shareholders.

Looking forward, the Group has a bright future as the leading provider of building products in the UK and we look forward to setting out our plans later in the summer to continue to drive growth."

In the year ended 31 December 2020, P&H generated revenue of £1,041 million, adjusted operating profit of £17.9 million* and a loss before tax of £1.7m. Gross assets at 31 December 2020 were £580 million.

Morgan Stanley & Co. International plc is acting as financial advisor to Travis Perkins plc in relation to the transaction.

*Including property profits of £1.4m

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About Travis Perkins

Travis Perkins plc is the UK's leading supplier of materials and equipment to the building, construction and home improvement markets, and operates market leading businesses, including Travis Perkins Builders' Merchants, Toolstation and three specialist merchants in the civils, heating and interiors markets, Keyline, BSS, and CCF. With annual revenues of over £4 billion, the Group employs over 16,000 colleagues across the UK, but also in France and Benelux through Toolstation. The company has a proud heritage that spans over 200 years.

Travis Perkins plc is listed on the London Stock Exchange (LSE: TPK) and is in the FTSE 250 index of listed companies. For more information please visit www.travisperkinsplc.co.uk

About H.I.G. Capital

H.I.G. is a leading global private equity and alternative assets investment firm with over €36 billion of equity capital under management. Based in Miami, and with offices in New York, Boston, Chicago, Dallas, Los Angeles, San Francisco, and Atlanta in the U.S., as well as international affiliate offices in London, Hamburg, Madrid, Milan, Paris, Bogotá, Rio de Janeiro and São Paulo, H.I.G. specializes in providing both debt and equity capital to small and mid-sized companies, utilizing a flexible and operationally focused / value-added approach. Since its founding in 1993, H.I.G. has invested in and managed more than 300 companies worldwide. The firm's current portfolio includes more than 100 companies with combined sales in excess of €27 billion. For more information, please refer to the H.I.G. website at www.higcapital.com