Aga gives equity stake to Fired Earth management team

AGA Rangemaster has signed a deal for the management team of its loss making retail subsidiary Fired Earth to acquire a 28% equity stake in the division.

Under the deal, the team will work to implement an three-year development plan aimed at delivering a “marked improvement” in profitability and cash generation through new product initiatives and a widening of the customer base.

Fired Earth made a trading loss of more than £2 million in 2010 on revenues of almost £22 million.

The management team is headed by managing director Andrew Manders, who joined Fired Earth in 2010 on an interim basis to undertake a strategic review. Mr Manders worked in the transaction team of KPMG before setting up his own consultancy and private equity fund. He worked on the Iceland Foods buy out from the Big Food Group, Jones Bootmaker, Mountain Warehouse and Aspinal of London.

Mr Manders is supported by Rob Whitaker, who has worked for Fired Earth for more than 10 years, and Charlie Smallbone, an early stage investor in Fired Earth in 1986 and formerly chief executive of Smallbone PLC, which included the stone specialist, Paris Ceramics. The incentive plan will include other
senior managers.

Fired Earth’s business plan is to develop further the tile operations which provide over half of the turnover, adding to the successful tile basics ranges launched last spring. Fired Earth will continue to invest in its retail portfolio and its bathroom and kitchen ranges, sold primarily in joint stores with AGA, while continuing to provide comprehensive packages to consumers on the group’s database of over 1.3m.

William McGrath, chief executive, said: “Fired Earth is a renowned brand with great potential. The energetic team, the clear improvement plan and timetable and the continuing Group support can now combine to see that potential realised.”