Epwin expands with Stormking acquisition

Epwin Group was looking to another expansion on Monday, announcing it was purchasing the entire issued share capital of Stormking Plastics.

The AIM-listed manufacturer said the deal was worth an initial consideration of £27m, consisting of £20.25m cash and 5,348,804 shares in Epwin Group (representing 3.78% of the enlarged share capital).

Epwin said further consideration of up to £8m may be achieved and settles in the same ratio of cash to shares, depending on Stormking's performance in the year to 28 February 2017.

"Stormking adds further to the group's range of low maintenance building products, as well as the plastics materials technologies that we can draw upon", said Epwin CEO Jon Bednall.

"The acquisition represents a further significant step in the development of the group, and is expected to enhance earnings in 2016", he added.

Co-founders of Stormking Plastics, Gary King and Barry Whitehall, said the decision to exit the business was not an easy one.

"In Epwin we are confident we have found a group that will allow Stormking Plastics to broaden its offering, and continue to see the brand and reputation enhanced", they said in a joint statement.

Cash consideration was to be met from existing banking facilities, which were renewed immediately prior to the acquisition to increase available facilities initially to £50m.

Admission of the shares to AIM was expected on or around 8 January 2016.

Epwin also confirmed profits for the year ended 31 December would be in line with market expectations, despite challenging market conditions.