Ferguson plc has announced it has agreed a deal to dispose of Wolseley UK to a global private investment firm for around £308 million.
Wolseley UK, the UK plumbing and heating division of Ferguson plc, expects to complete the deal by the end of January.
In the year to July 31, 2020, Wolseley UK had sales of £1.4 billion and produced a trading profit of £5.9 million. Adding the USA to the picture, turnover totalled £14.8bn with a trading profit of £1.2bn.
Following the sale, the company said that Ferguson plc Group would retain responsibility for its UK defined benefit pension scheme, which at the end of July had a net pension liability of £20m.
Commenting on the deal, Ferguson chief executive Kevin Murphy (pictured) said: “Wolseley is a leading heating and plumbing distribution business in the UK and we are confident the business will benefit from working with its new owners, Clayton, Dubilier and Rice, who will develop the business further by focusing on continued opportunities in the industry.
“We’d like to thank all our associates for their tireless hard work while they have been part of the group, especially recently through the Covid-19 pandemic. We wish them all the very best for the future.
“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.”
The company is a leading plumbing, heating and cooling trade specialist merchant in the UK and distributes through around 600 branches nationwide.
With manufacturing roots going back to 1887, Wolseley changed its focus to distribution in 1979. It made a move into the US market in 1982 with the acquisition with Ferguson Enterprises Inc. Further acquisitions led to an increase in sales from £27m in 1974 to over £739m in 1986.
In July 2017, Wolseley plc changed its name to Ferguson plc. The change was backed by shareholders who wanted a stronger connection between the plc and its largest brand, Ferguson, in the US.