Brickability Group PLC Roof Tile Joint Venture (4250E)
11 March 2022 - 06:00PM
UK Regulatory
TIDMBRCK
RNS Number : 4250E
Brickability Group PLC
11 March 2022
Brickability Group PLC
LEI: 213800SK28MWXB3K3P26
11 March 2022
Brickability Group plc
("Brickability" or "the Group")
Roof Tile Joint Venture
Brickability Group plc (AIM: BRCK), the leading construction
materials distributor, is pleased to announce the formation of a
joint venture with La Perla Participaties B.V. ("La Perla") and Mr
Harold Kock for the manufacture of clay roof tiles via a
jointly-owned joint venture vehicle Schermbecker Building Products
GmbH (the "Joint Venture") operating from a factory in Germany
leased from Falzziegelwerke Gebr. Nelskamp GmbH & Co. KG
("Nelskamp"), a leading German tile manufacturer and producer of
roofing materials.
Highlights
-- The Joint Venture, once fully operational, is expected to
produce approximately 45,000 tonnes of clay roof tiles annually
for distribution into the UK and European markets. The Group
currently imports around 25,000 tonnes of clay roof tiles
annually.
-- This production will, when fully operational, provide around
22 million additional clay roof tiles annually for the Group
which will generate approximately GBP9 million of incremental
annualised revenue for the Group.
-- The production of clay roof tiles for the UK market is expected
to start-up in Autumn 2022 once the necessary modifications
to the factory have been fully commissioned.
-- Brickability to hold 50% interest in the Joint Venture company
following a Eur 0.5 million investment by the Group.
-- Brickability will provide a term loan into the Joint Venture
of Euro 3.5 million, due for repayment at the end of June
2025, to fund Joint Venture working capital, the purchase
of assets and new capital investment required to produce
tiles for the UK market.
Alan Simpson, CEO, Brickability Group plc, said:
"This strategic partnership with Nelskamp will provide a much
needed solution to the severe shortage of clay roof tiles in the
UK, in doing so further strengthening the Group's position in the
market and further demonstrating both Brickability's expertise in
procurement and the long and strong relationships we enjoy with our
partners."
Joint Venture Agreement
In forming the Joint Venture, the Group has entered into a joint
venture agreement (the "JV Agreement") with La Perla and Mr. Harold
Kock. Under the terms of the JV Agreement, Brickability will have
an interest of 50% of the Joint Venture's issued share capital and
La Perla and Mr. Kock holding 40% and 10% interests in the Joint
Venture respectively. Under the JV Agreement, joint contributions
of an aggregate of Euro 1.0 million will be made to capitalise the
Joint Venture, pro-rated to the participants respective
shareholdings in the Joint Venture.
In addition, the Group has agreed to provide a Euro 3.5 million
term loan to the Joint Venture to fund Joint Venture working
capital, the purchase of assets and new capital investment required
to produce tiles for the UK market (the "Term Loan"). The Term
Loan, which is secured on the assets of the Joint Venture and
carries a coupon of 3.0% per annum above Bank of England base rate,
will mature on 30 June 2025.
Mr Kock, Sales Director of Dachziegelwerke Nelskamp GmbH will
represent the Nelskamp group's interest in the Joint Venture. Mr.
Kock and Arnold van Huet, Managing Director of Brickability's
wholly owned subsidiaries which make up the Crest Group of
companies, will serve as Co-Managing Directors of the Joint
Venture. In his capacity as Managing Director of the Crest Group of
companies, Arnold van Huet was, at the time of the formation of the
Joint Venture but ahead of the execution of the Term Loan, the sole
shareholder and director of La Perla in order to provide control of
Schermbecker Building Products GmbH for the Group.
Mr. van Huet has since resigned as a director of La Perla and
transferred the entire issued share capital of La Perla to Mr Kock
for nil consideration. However, and as a result of Mr. van Huet's
previous legal interest in La Perla on entry by the Group into the
JV Agreement with La Perla, the entry of the JV Agreement is
considered to be a related party transaction pursuant to Rule 13 of
the AIM Rules for Companies. Mr. van Huet has not, and will not,
receive any economic benefit or beneficial interest in or resulting
from the formation of the Joint Venture.
The Brickability directors (all of whom are regarded as being
independent) consider, having consulted with the Group's nominated
adviser, that the entry of the joint venture agreements is fair and
reasonable in so far as shareholders are concerned.
ENDS
For further information please contact:
Brickability Group plc via Montfort Communications
John Richards, Chairman
Alan Simpson, CEO
Mike Gant, CFO
Cenkos Securities plc (Nominated adviser
and broker)
Ben Jeynes, Max Gould (Corporate Finance)
Julian Morse, Alex Pollen (Sales) +44 (0) 20 7397 8900
Montfort Communications
James Olley
Georgia Colkin +44 (0) 203 514 0897
About Brickability
Brickability is a leading construction materials distributor,
serving customers across the UK and Europe for over 36 years
through its national and local networks. The company supplies over
500M bricks annually and has 41 locations across the country with
over 500 employees.
Across its 3 divisions the Group supplies bricks, roofing,
timber, cladding, heating, flooring, doors and windows to meet
demand from both housebuilders and contractors.
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