Crown Paints put on market by Endless

ENDLESS has appointed advisors to sell paint manufacturer Crown Paints with the Yorkshire turnaround and private equity house understood to have placed a price tag of more than £100m on the business.

The  corporate finance team at Deloitte has been appointed as advisors to handle the sale of Darwen-based Crown Paints by its Leeds-based owners Endless.

Endless backed a £70m buyout of the 200-year Crown Paints business just two years ago. The sale was sparked by a European Competition Commission ruling following Dutch chemical giant Akzo Nobel’s purchase of ICI, which owned the larger Dulux brand.

Endless immediately replaced former chief executive Howard Luft, initially bringing in turnarounds expert Graham Hallworth before eventually installing Brian Davidson as its chief executive.

It has implemened new product launches aligned with promotions which has seen its share of the of the UK consumer market for paint jump by 2% to 19%.

It has also implemented a cost control programme which has generated around £20m of cash, which means it is no longer carrying any bank debt but has headroom facilities of around £50m.

A price tag of more than £100m is understood to have been placed on the business, which is expected to attract interest from both trade and private equity buyers.

Earlier this week, the firm revealed that its earnings before interest, tax, depreciation, amortisation and rentals) is expected to double to £20m in 2010, compared with £10.5m last year. Turnover has remained largely flat at around £180m in a declining market for paints and coatings.

Mr Davidson also said the firm had continued to invest in new plant, machinery and technology as well as the development of its Crown Decorating Centre network.

“As with any private equity-backed business, the creation of shareholder value remains a key focus area for all stakeholders within the business,” he said.

A spokesman for Endless said: “Crown Paints has made outstanding financial and operational progress since our investment in October 2008. The business has doubled profits in its last financial year and is outperforming the wider UK coatings market.

“Consistent with our investment strategy, we are continuously exploring strategic options for Crown.”