Brammer aiming to raise £50m+ to fund acquisitions
BRAMMER, the distributor of industrial components and tools, is looking to create a war chest for acquisitions through a £53.7m fund raising.
The group – which owns Coventry-based tool business Buck & Hickman – is planning to raise the funds through a placing of more than 11.3m shares at 475p per share.
The company, which acquired a Scandinavian competitor – Lönne Holding – in a £38m deal in January, said it has a pipeline of acquisition opportunities in Europe and the fundraising would make these easier to achieve,
In a statement to the London Stock Exchange this morning it said: “In considering such bolt-on acquisitions, the board recognises the importance of the group maintaining an appropriate capital structure.”
It added: “The proceeds of the placing will provide the group with the capability to pursue both these current and other value enhancing acquisition opportunities. The proceeds will be used to reduce the group’s borrowings in the short term and therefore the placing is expected to be earnings dilutive in the current financial year.
“However, given the current pipeline of potential bolt-on acquisitions, the group expects to have deployed the majority of the proceeds within the next six to 12 months.”
The company gave a brief trading update, reflecting quiet confidence with sales per working day in the first quarter of 2014 rising 5% on a like-for-like basis and 13% including the Lönne acquisition.
