Radiator manufacturer Stelrad has announced a £24m deal to acquire a European competitor, just over six months after floating on the Stock Exchange.
The company, which has its headquarters in Newcastle and its main manufacturing facilities in South Yorkshire, has agreed to buy Italian firm DL Radiators for €28.3m.
DL produces and sells radiators into the Italian heating market and employs around 350 people at its site in Moimacco, near Udine. It generated €86.9m (around £75m) revenue and €5m (£4.3m) normalised EBITDA in 2021, with gross assets of €62.9m (£54m).
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Stelrad, which also has sites in Holland and Turkey, said the deal would extend the range of radiators available to its sales and distribution network and expand its routes to market.
It said the cash deal would be funded from its existing facilities and it expected the acquisition to be earnings enhancing in the current financial year.
DL Radiators’ management team will continue to run the Italian business, with oversight from Stelrad.
Trevor Harvey, CEO of Stelrad, said: “This is a compelling transaction for Stelrad and allows us to grow our business through the provision of additional products and through geographical expansion. DL Radiators has strong brands with a significant customer base and we look forward to working with the team to realise value opportunities and expand the market for their higher value product ranges.
“Following completion of this transaction, Stelrad will be a market leader in six countries and hold a top three position in five more. We will continue to develop our mainland European relationships with the long-established regional distribution players in those territories, ensuring we continue to adapt to evolving routes to market.”
Stefano Valente, CEO of DL Radiators, said: “We firmly believe that the success of a company is built on the commitment of people who are passionate about their work and who can open up to the world and creatively contribute to its improvement. We see this as a shared value with Stelrad’s experienced team from the management through to sales and operations and we are excited to work alongside them to grow DL Radiators as a leading heat emitter manufacturer.
“The mission of DL Radiators is the creation of heating products fit for the future, which are able to improve not only the comfort of the rooms but the quality of everyday life, combining intuitive technological capabilities with Italian attention to design. Our partnership with Stelrad allows us to continue to fulfil this mission to provide a best-in-class offering.”
Stelrad, which can trace its history back to the 1930s, employs around 1,300 people and is the leading radiator seller in UK, Ireland, the Netherlands, Belgium and Denmark.
It said the acquisition constituted a class 2 transaction, with its announcement made pursuant of Chapter 10 of the UK Financial Conduct Authority’s Listing Rules.
