Ferguson PLC (LON:FERG) has struck a deal to sell its UK business, Wolseley, to a US private equity company for £308mln in cash.
The deal, which comes less than three years after the plumbers’ merchant, then known as Wolseley, changed its name to Ferguson to reflect its increasing focus on the US, is expected to complete at the end of this month.
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The FTSE 100-listed company said the board's current intention is to return most of the proceeds of the sale to shareholders via a special dividend.
Wolseley UK, which has been up for sale since September 2019, made a trading profit of £8mln from revenue of £1.9bn in the year ended July 31, 2020, compared to £1.7bn and £19.9bn for the ongoing North American businesses.
“The transaction further simplifies the group and allows us to focus entirely on investing in and developing our business across North America where we have the greatest opportunities for profitable growth,” said Ferguson group chief executive Kevin Murphy in a statement.
Ferguson will retain responsibility for the UK defined benefit pension scheme, which had a net pension liability of US$27mln, once the deal is done with purchaser Clayton, Dubilier & Rice, and the Wolseley UK business will retain no ongoing liabilities in relation to the scheme.