The company intends to update shareholders on the use of the proceeds of sale after completion of the disposal
Ferguson plc has announced that it has entered into an agreement to sell Wolseley UK, its UK based heating and plumbing distribution business, to Clayton, Dubilier & Rice, a global private investment firm for net cash consideration of approximately £308 million.
In the year ended July 31 2020, Wolseley UK generated revenue of $1,879 million and underlying trading profit of $8 million on a pre-IFRS 16 basis. Gross assets at July 31, 2020 were $1,093 million.
Following completion of the disposal, future responsibility for the UK defined benefit pension scheme will be retained within the Ferguson plc Group. At July 31 2020, the net pension liability was $27 million on an IAS 19 basis. The Wolseley UK business being disposed will retain no ongoing liabilities in relation to the UK defined benefit pension scheme. Excluding the net pension liability, the net operating assets of Wolseley UK at July 31 2020 were $378 million.
Feguson expects the transaction will complete at the end of January 2021. Following completion of the disposal, the company intends to update shareholders on the use of the proceeds of sale. The board’s current intention is to make a return of substantially all of the net cash proceeds of sale to shareholders by way of a special dividend.
Kevin Murphy, Chief Executive of Ferguson, commented: Wolseley is a leading heating and plumbing distribution business in the UK and we are confident the business will benefit from working with its new owners, Clayton, Dubilier & Rice who will develop the business further by focusing on continued opportunities in the industry. We’d like to thank all our associates for their tireless hard work while they have been part of the group, especially recently through the COVID-19 pandemic. We wish them all the very best for the future.