Grafenia plc Acquisition (1890U)
16 January 2017 - 6:00PM
UK Regulatory
TIDMGRA
RNS Number : 1890U
Grafenia plc
16 January 2017
GRAFENIA PLC ("GRAFENIA")
ACQUISITION OF ADD SIGNS
Grafenia (GRA) announces that it has completed the acquisition
of the entire share capital of Liverpool based ADD Signs (Arthur
Diamond Design Limited). Mark Eccleston, the vendor of ADD Signs,
joins Grafenia as Regional Director of the main operating company
in the Group. He will continue to lead the team at ADD Signs and
develop the business. In the year ending 31(st) December 2016, ADD
Signs' turnover was approximately GBP375,000.
Peter Gunning, CEO of Grafenia said "After working on projects
with Mark and his team for several years, we are delighted to
welcome them to the Grafenia family. We have ambitious plans for
making signs a bigger part of our offering and are excited that
Mark shares our vision."
Mark Eccleston said "We've grown our business steadily over the
past few years and were looking for ways to take it to the next
level. Making cool signs for Nettl, I was intrigued by their
business model. When the guys shared their plans with me, it just
felt like it made sense and I wanted to play a part in making it
happen."
Market convergence
Historically print, design and sign-making businesses were
discretely different, with limited overlap. More recently, these
businesses have converged. Sign makers sell print and most printers
supply banners and posters to their clients.
Once a client builds a relationship with a designer, it's common
for them to trust the designer to fulfill all graphic requirements
- from branding, web, adverts and print, to expo, displays and
signage.
As well as printing, Grafenia supplies a complementary range of
expo and point-of-sale signage products through Nettl and
printing.com partners. Last year Grafenia invested in equipment to
enter the expanding soft signage market which, according to
Smithers Pira, is forecast to grow at 20% per year until 2019 and
to double in size within 5 years.
Whilst there are several established franchise networks, the
signage sector remains highly fragmented. Although some signs can
be made centrally and shipped cost-effectively, the majority of
vehicle graphics and shop signs require local survey and specialist
on-site installation.
Transaction benefits
ADD Signs has a strong reputation servicing a range of clients,
from small businesses in the North West, to large enterprises,
nationwide. This acquisition provides Grafenia with expertise in
designing, manufacturing and installing a wide range of vehicle
graphics and building signs.
Peter Gunning said "We want to use ADD's know-how to extend our
offering further into the sign sector and help our Nettl and
printing.com partners sell more to clients. We'll use ADD's skills
to merchandise a range of sign products to sell nationally through
our network. And for partners on Merseyside, we plan to give them
access to our manufacturing and installation services."
This includes extending the Nettl offering into vehicle
graphics. ADD's vehicles will be wrapped to proliferate the Nettl
brand locally, as a model to replicate across the country.
ADD will also substitute print, previously outsourced to a
variety of suppliers, with products from the Grafenia range. ADD's
clients will be able to access a much wider range of print and
promo items from the Nettl range, all delivered with the usual
reliability and compelling value.
Peter Gunning said "In a converged print and signs sector, our
goal is to establish Nettl as the industry leader." Nettl is
available as either a stand alone or bolt-on model for existing
graphics businesses. There are currently over 90 Nettl
neighbourhood web studio partners in the UK and Ireland and new
partners are signing up every month. "Our systems, training and
know-how allow a printer, designer or signmaker to deliver higher
value web projects, by upskilling their existing team. Whether it's
with print, ecommerce or signage, our aim is to simplify and
'de-frictionify' the process. Our clients want to get the most from
their promotional budget and we deliver clear, transparent value
and an honest, reliable service."
Further acquisitions
The acquisition of ADD Signs is the first in Grafenia's planned
strategy for growth and the Board is now looking for other signage
businesses on Merseyside, where the owner is looking to exit or
retire. The aim is to roll businesses together with ADD Signs and,
at an appropriate point, combine manufacturing facilities and
launch a Nettl Business Store.
Peter Gunning said "We aim to replicate this model across the
country. To provide local survey, specialist on-site installation
and enable signs to be offered throughout our Nettl network. If you
operate a signage business and are looking for an exit strategy or
would like support to grow, please email letmein@grafenia.com. We'd
love you to join us."
For further information:
Grafenia plc
Peter Gunning (Chief Executive) 07973 191 632
Alan Roberts (Finance
Director) 0161 848 5713
N+1 Singer (Nominated
Adviser)
Richard Lindley / James
White 0207 496 3000
This information is provided by RNS
The company news service from the London Stock Exchange
END
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