Victoria PLC (AIM:VCP) said it has acquired Florida-based flooring distributor International Wholesale Tile LLC (IWT) for US$28.5mln (£24.9mln) in a deal that will be immediately earnings enhancing and cash flow accretive.
A further capped payment is payable over the next four years, conditional on IWT achieving certain growth and earnings targets, the flooring company said in a statement.
Victoria said the acquisition is part of its strategy of growing the business in North America by acquiring successful distributors that sell the same categories of product as it manufactures and sells in Europe.
IWT is a specialty distributor of ceramic & porcelain tiles, natural stone, luxury vinyl tiles and decorative glass tiles, as well as tile and stone installation systems.
In the year to March 2022, IWT generated revenues of US$63.2mln and and had normalised EBITDA of US$7mln.
Including IWT, Victoria's North American-derived revenues will exceed US$400 million, accounting for 27% of group income, the company noted.
"Victoria has been profitably selling a significant amount of product into the US$29bn - and growing - US market for many years. The acquisition of Cali in July 2021 has proven to be very successful and IWT is a further step for Victoria into North America,” commented Victoria chief executive Philippe Hamers in a statement.
Geoff Wilding, the company's executive chairman, added: "Whilst the board remains mindful of the macroeconomic headwinds across the globe, it maintains a long-term view in its mission to create wealth for shareholders. Consequently, when very attractive acquisition opportunities arise, we simply focus on ensuring we are buying high-quality, resilient businesses at valuations that provide a margin of safety for our shareholders."
“We believe IWT represents such an opportunity with its steady growth over an extended period, high-quality management, and significant synergy opportunities," Wilding concluded.