Wynnstay Regulatory News (WYN)

14 Jan 2008 07:01

Wynnstay Group PLC14 January 2008 WYN.L Wynnstay Group plc ("Wynnstay" or "the Group") Acquisition of Pet Superstores Chain Wynnstay, the retail and agricultural supplies business, is pleased to announcethe acquisition today of Wilsons Pet Centres Limited ("Wilsons Pet Centres"),the Midlands based chain of pet superstores, for a gross cash consideration ofup to £5.85m. After taking into account the utilisation of surplus cash in theacquired business, amounting to approximately £0.69m, the net consideration isup to £5.16m. The acquisition wholly complements Wynnstay's existing petsupplies and retailing activities, adding critical mass and giving Wynnstay astrong market position in the West Midlands region. Wynnstay expects theaddition of Wilsons Pet Centres to be immediately earnings enhancing. Based in Bromsgrove in the West Midlands, Wilsons Pet Centres was established in1993. Since then, the management has built up a chain of 10 pet superstores,with locations in the south west Midlands in Evesham, Malvern, Worcester,Droitwich, Kidderminster, Northfield, Acocks Green, Stourbridge, Swadlincote andBromsgrove. The stores, which are all leasehold, are modern and spacious, withan average floor space of 6,000 sq ft, and are typically located within retailparks. Each store offers a comprehensive range of pet care products as well asrelated services such as in-store pet grooming, pet behaviour courses and petinsurance. Wilsons Pet Centres has 104 employees on a full time equivalentbasis. For the year ended 28 October 2007, Wilsons Pet Centres generated revenues of£6.8m and pre-tax profits of £669,609. At completion, adjusted net assets stoodat £1.0m (excluding surplus cash of approximately £0.69m). Following the completion of the acquisition, the two principal directors ofWilsons Pet Centres, who together have 42 years' experience of pet suppliesretailing, will remain with the business and will lead the on-going developmentof Wynnstay's pet products retailing activities. Wynnstay has a successful track record of integrating retail acquisitions andthe Group believes that there is excellent potential for expanding itspet-related activities through both dedicated pet and general stores. WilsonsPet Centres will be rebranded under Wynnstay's existing pet brand, 'Just forPets', and as part of the Wynnstay group, it is expected that it will benefitfrom opportunities to enhance purchasing, marketing and its product offering. Of the total net acquisition consideration of up to £5.16m, £4.3m is payable incash on completion, with the balance payable in cash in January 2009, dependingon the achievement of certain financial targets during the first year. Theinitial payment will be satisfied from Wynnstay's existing cash resources and anew five year loan facility of £3.0m from HSBC plc carrying an interest rate of1% over base rate. Bernard Harris, managing director of Wynnstay, commented, "We have been extending Wynnstay's existing retailing activities into the highgrowth area of pet care products for some time now and, following the launch inthe Summer of our own dedicated pet store format, Just for Pets, the acquisitionof Wilsons Pet Centres is the next logical step. Wilsons Pet Centres is a long-established, well-run chain in the West Midlands,with a reputation for efficient and friendly customer service. Combining thebusiness with our own is compelling and brings significant benefits, both fromthe point of view of cost efficiencies and ongoing growth strategies. I am very pleased too that the senior management team at Wilsons Pet Centreswill remain with the enlarged business, leading its development, and believethat there are exciting growth opportunities ahead of us." Press enquiries: Wynnstay Group plc Bernard Harris, Managing Director T: 01691 828512 Paul Roberts, Finance Director Biddicks Katie Tzouliadis T: 020 7448 1000 WH Ireland Limited David Youngman T: 0161 832 2174 This information is provided by RNS The company news service from the London Stock Exchange