£175m London stock market flotation for PVC-U extrusion company Eurocell
Eurocell has become the first PVC-U extrusion company to float on the main market of the London Stock Exchange, following an announcement on 4 March that shares would be made available as part of an Initial Public Offering (IPO).
Interest from investors has been high because of Eurocell Group’s strong market positions, vertically integrated business model, innovation-driven culture and strategic commitment to sustainability.
Previous outright owners H2 Equity Partners will be retaining a significant shareholding in the business moving forward, an indication of its confidence in the strength of Eurocell.
As part of the IPO, a number of key external people have been appointed that bring significant additional plc and construction industry experience. This includes Robert Lawson, former chairman of housebuilder Barratt Developments and recruitment firm Hays, who becomes Chairman.
Patrick Bateman, Chief Executive Officer of Eurocell plc, said: “We have been delighted by investor demand throughout the IPO process and now look forward to life as a quoted company. Eurocell’s listing on the London Stock Exchange delivers a strong platform to build on the considerable success the business has already achieved. We will continue to execute our strategy to drive future growth by maximising the benefits of our vertically integrated model, opening new branches, driving greater cross-selling within the branch network and developing innovative new products.”
Eurocell has made a number of significant achievements in the last few years with post-consumer recycling, new product innovation and market share gains. Considerable success has been achieved recently in the new build and specification sectors and this will continue to create opportunities going forward.
A multi-million pound investment in Modus (2014), the innovative new window profile system, looks set to create further opportunities in all market sectors at a time when the construction and RMI outlook is the most positive for many years.
Naturally, the issue of future acquisitions has been raised now that the company has access to other sources of capital. However, Patrick points out that Eurocell has always considered strategic acquisitions where it adds value to its customer proposition or helps deliver stated business goals.
To this end, Eurocell acquired Merritt Plastics which, following significant further investment, has created the largest post-consumer PVC-U recycling facility in the UK, Cavalok cavity closers (new build sector), Peninsula Plastics (vertical integration and strengthening the branch network in the North West) and Plastmo (new build and retail sectors). The company will continue to consider bolt-on acquisitions as and when appropriate.
“Our strategy remains focussed on growing sales above market growth through leadership in products, operations, sales, marketing and distribution,” said Patrick. “We will continue to leverage the Eurocell brand and drive home our investments in new innovations and the advantages that our vertically integrated business model with local distribution offers our customers.
An IPO is a very positive and exciting step for Eurocell as we build on our recent success. Becoming a PLC gives us greater stability and independence, whilst removing any industry-perceived issues around recent changes of ownership. From a commercial perspective it further builds our brand profile and strengthens our attractiveness as a main-market listed business partner.
This new ownership platform allows us to continue our vision to develop more new products and services that go towards our stated goal of earning the lifetime loyalty of our customers.”
For more information on the Initial Public Offering (IPO) of Eurocell shares, visit: http://www.eurocell.co.uk/IPO-documents
