19 March 2024
Wickes Group
plc
Acquisition of majority stake
in
leading solar installations
business Solar Fast
Wickes Group plc ("Wickes")
announces today that it has agreed to acquire 51% of the issued
share capital of Gas Fast Limited ("the Business"), the parent
company of leading solar installations company Solar Fast ("Solar
Fast") ("the Transaction"). The Business focuses on solar
panels installations, alongside a smaller business installing gas
boilers.
The acquisition will enable Wickes
to expand its offering into the fast-growing market for home energy
solutions, initially with solar and gas boilers and, in time, air
source heat pumps and other services. The UK market for domestic
solar installations is highly fragmented and is expected to expand
significantly from an estimated £1.1bn in 2024 to £1.5bn in
20281 as homeowners and landlords retrofit their
properties in order to save energy costs and reduce their
environmental impact.
With its heritage as a trusted
partner for major home improvement projects and installations,
Wickes believes that it is well placed to take a leading share of
this growing market and the Solar Fast acquisition enables it to
expand its range of Design & Installation
services.
David Wood, Chief Executive of Wickes,
commented:
"I
am delighted to announce our acquisition of a majority stake in
Solar Fast, a leading operator in the emerging and exciting market
for energy saving solutions. This acquisition enables us to
accelerate our Design & Installation growth lever, capitalising
on our expertise in installing major home improvement
projects.
"The Wickes brand has been trusted by home improvers for over
50 years and with Solar Fast as part of our proposition we will be
perfectly placed to support them with their energy saving
plans.
"I'd like to take this opportunity to welcome David Draper and
his impressive team to the Wickes family and we look forward to
delivering our exciting plans together".
David Draper, Founder and CEO of Solar Fast,
commented:
"This is tremendous news for Solar Fast. We're a family
business and our vision has always been to become the number one
provider in the UK for quality domestic solar installations and
with the Wickes brand behind us, we are closer to achieving that
vision. I, along with all of the Solar Fast team, are very
much looking forward to being part of the Wickes family and to
working together to make UK homeowners more energy
independent."
Further information on Solar Fast and the
Transaction
The Business will be fully
consolidated into Wickes' accounts upon completion. It is
cash generative and profitable and is expected to be immediately
accretive to group profits.
Over 2022 and 2023 Solar Fast
installed over 3,700 solar projects in customers' homes. In
the twelve months to 30 April 2023 the Business generated revenue
of £33.1m and reported profit before tax of £3.9m. The solar
market experienced a short-term peak in demand during the energy
crisis of 2022/2023 and as such it is anticipated that both market
demand and Solar Fast's revenue will be lower in 2024 before
growing again thereafter. As of 30 April 2023 the Business had
gross assets of £5.9m and net assets of £3.8m.
Wickes will acquire the 51% equity
stake from the Solar Fast founders based on a valuation for 100% of
the Business of 7x EBITDA delivered in calendar year 2024, with a
minimum valuation for 100% of the Business of £10.0m and a maximum
of £36.0m, on a debt-free, cash-free basis. Wickes will pay £5.1m
at completion of the Transaction as a minimum payment for the 51%
equity stake, with the balance to be paid in early 2025. Wickes
will fund the purchase price from existing cash
reserves.
Wickes has an option to purchase the
remaining 49% of the issued share capital of the Business. This
option may be exercised during the five years following completion,
in tranches of not less than 10% of the issued share capital, and
is based on a pre-agreed valuation based on 6x LTM EBITDA at the
time.
The Founder and CEO of the Business,
David Draper, will continue to lead the development and growth of
the Business in collaboration with the Wickes team, who will help
bring the Solar Fast proposition to Wickes customers in store and
online.
Since the Business offers financing
solutions to customers and is regulated by the FCA, the transaction
will be subject to FCA approval. We expect this approval to
be granted in the coming weeks.
This announcement should be read in
conjunction with Wickes' full year 2023 results which are also
released today.
Enquiries
Investors and Analysts
Holly Grainger
Director of Investor
Relations
+44 (0)7341 680426
holly.grainger@wickes.co.uk
|
Media
Lucy Legh, Will Smith
PR Advisers to Wickes
+44 (0)203 805 4822
wickes@headlandconsultancy.com
|
About Wickes
Wickes is a digitally-led, service-enabled home improvement
retailer, delivering choice, convenience, value and best-in-class
service to customers across the United Kingdom, making it well
placed to outperform its growing markets. In response to gradual
structural shifts in its markets over recent years, Wickes has a
balanced business focusing on three key customer journeys -
TradePro, DIY (together reported as Retail) and our project-based
Design & Installation division.
Wickes operates from its network of 229 right-sized stores,
which support nationwide fulfilment from convenient locations
throughout the United Kingdom, and through its digital channels
including its website, TradePro mobile app for trade members, and
Wickes DIY app. These digital channels allow customers to research
and order an extended range of Wickes products and services,
arrange virtual and in-person design consultations, and organise
convenient home delivery or click-and-collect.
Footnotes
1) Source: Wood Mackenzie UK PV
Capacity Forecast