Accrol Group Holdings PLC Acquisition of highly scalable wet wipes business (9032U)
09 April 2021 - 4:00PM
UK Regulatory
TIDMACRL
RNS Number : 9032U
Accrol Group Holdings PLC
09 April 2021
9 April 2021
ACCROL GROUP HOLDINGS PLC
("Accrol", the "Company" or the "Group")
AIM: ACRL
ACQUISITION OF HIGHLY SCALABLE WET WIPES MANUFACTURER
Accrol Group, one of the UK's leading independent tissue
converters, is pleased to announce that the Group has completed the
acquisition of John Dale Limited ("John Dale"), a highly scalable
flushable and biodegradable wet wipes business, for a total cash
consideration of GBP3.9 million, funded from the Group's existing
cash reserves.
Acquisition rationale
The acquisition of John Dale is a strategic move into high
growth products within the wet wipes segment of the tissue market,
providing a well invested platform on which to build a sizeable
business.
Highlights
-- John Dale has a long-established and unrivalled reputation as
a privately-owned manufacturer of high quality own branded and
private label wet wipes and facial tissues for the UK retail
market
-- Accrol and John Dale share several customers, but John Dale
also brings a number of significant new accounts into the Group
-- The product range includes flushable and biodegradable moist
toilet wipes, anti-bacterial and anti-viral wipes, facial cleansing
wipes, baby and toddler wipes and feminine hygiene wipes
-- The addition of incremental volume to the Accrol facial
tissue business will serve to leverage the Group's existing
production facility in Blackburn
The business currently operates a single daily shift, five days
a week, from its owned premises in Flint, North Wales, which is
currently generating annualised revenue of c.GBP6.0 million and
EBITDA (normalised) of c.GBP0.6 million.
Following acquisition, Accrol's primary areas of focus will be
the expansion of the anti-bacterial and anti-viral wet wipe ranges
and optimisation of production facilities.
The acquisition includes the 47,000 sq.ft. property from which
the business operates. Both the business and the property were
purchased from John and Pauline Dale.
Dan Wright, Executive Chairman of Accrol, said:
"I am delighted to announce the purchase of the John Dale
business in Wales. A move into the attractive wet wipes' segment
has been on our radar for some time; as a natural extension of our
product range and wholly in line with our growth strategy across
the household products category. It was essential, however, for us
to find a business with a disruptive and environmentally friendly
product which we could scale through organic investment. John Dale
fits our criteria for growth - quality of product and market
positioning, operating excellence in its asset base, and the
optimisation of our distribution strengths. It gives Accrol a
ready-made platform on which to build a sizeable wet wipes
operation and presents an unmissable opportunity for us to compound
shareholder value."
Gareth Jenkins, CEO of Accrol added:
"John Dale is an excellent business, with three modern wet wipe
machines, which are significantly under-utilised. The UK wet wipe
market is valued at GBP0.5bn. We are confident that, with our wide
customer base, market and operational know-how and a modest
investment in additional machine assets, we can scale this business
significantly, while generating strong margins, over the next two
to three years. The slack within the property and working capital
assets of the business will fund much of this growth and accelerate
financial returns."
For further information, please contact:
Accrol Group Holdings plc
Dan Wright, Executive Chairman Via Belvedere Communications
Gareth Jenkins, Chief Executive Officer
Zeus Capital Limited (Nominated Adviser
& Broker)
Dan Bate / Jordan Warburton Tel: +44 (0) 161 831 1512
Dominic King / John Goold Tel: +44 (0) 203 829 5000
Liberum Capital Limited (Joint Broker) Tel: +44 (0) 20 3100 2222
Clayton Bush / Edward Thomas
Belvedere Communications Limited
Cat Valentine Tel: +44 (0) 7715 769 078
Keeley Clarke Tel: +44 (0) 7967 816 525
Llew Angus Tel: +44 (0) 7407 023 147
accrolpr@belvederepr.com
Overview of Accrol
Accrol Group Holdings plc is a leading tissue converter and
supplier of toilet tissues, kitchen rolls and facial tissues to
many of the UK's leading discounters and grocery retailers across
the UK. Following the recent acquisition of a state-of-the-art
tissue converter based in Leicester, the Group now operates from
five sites, including four in Lancashire, which generate revenues
totalling c.16% of the GBP1.7bn UK retail tissue market.
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