Epwin acquires Stormking

RNS Number : 6361K
Epwin Group PLC
04 January 2016

Epwin Group Plc

(“Epwin” or the “Company” or the “Group”)

 Acquisition of Stormking Plastics Limited


Trading Update

 Epwin Group Plc (AIM: EPWN), the vertically integrated manufacturer of extrusions, mouldings and fabricated low maintenance building products, supplying the Repair, Maintenance and Improvement (“RMI”), new build and social housing sectors, is pleased to announce the acquisition of the entire issued share capital of Stormking Plastics Limited, (“Stormking”), for consideration in cash and Epwin Group Plc shares with part deferred and dependent upon the future performance of the business. 


The acquisition is in line with Epwin’s stated strategy to broaden its range of low maintenance building products, its technical capabilities and routes to market.  The Board believes that Stormking’s product technology has potential for use in a wider range of low maintenance building products, markets and applications. (www.stormking.co.uk).

 Stormking Plastics

 Stormking Plastics is the leading supplier of moulded GRP building components to the house building and construction industry in the UK.  The product range includes dormers, chimneys, bay window roofs, entrance canopies, copings and support brackets, as well as similar time-saving components for the housebuilding and construction sector.

 The Company was founded in 1985 by Gary King and Barry Whitehall, both of whom had strong links with the building industry and, with their experience in GRP, they recognised the potential to develop the use of the material to support greater efficiencies in building construction as well as provide the visual enhancement desired by housebuilders. 

 Both of the founders have recently retired after 30 years of running the business, having handed over day to day management to a new management team, who will now take the business forward as part of Epwin Group.

 Stormking has earned a reputation, over the last 30 years, for both the quality of its products and the outstanding service that it provides. The business prides itself on the breadth of its product range and customer base, backed up by independently tested production methods setting the standard in the sector.

 Stormking’s manufacturing is based in Tamworth, Staffordshire, where the Company employs in excess of 200 full time staff.  Stormking has continually innovated production methods and its product range, with a strong emphasis on developing production methods and new products for its customers.  Significant research and development is undertaken to continually improve production methods to give the customer the best products with the best service possible.  This department has also developed innovative new products giving the customer better choice as well as increasing efficiency on construction sites by simplifying the build process and removing complexity.

 Stormking has set the standard for prefabricated G.R.P Building Products and developed management systems meeting the ISO 9001, ISO 14001 and CHAS standards which complements Epwin’s own focus on offering the best standards to its customers.  Stormking will operate alongside Epwin’s extrusion and moulding businesses.

 The business has developed a significant amount of know-how in the formulation and use of GRP materials and is developing plans to expand the use of these materials in additional applications and markets which the Group believes that it is well placed to assist with.


In the financial year ended 28 February 2015, Stormking reported turnover of £22.8m and underlying earnings before interest, taxation, depreciation and amortisation costs, (EBITDA), of £3.0m.  In the current year to February 2016, performance is expected to deliver turnover in the order of £25m and an underlying EBITDA, of circa £4.5m resulting from increased use of the products, stronger new build sector trading and new management team projects looking at efficiency opportunities. Net assets acquired at acquisition are around £3m. The acquisition is expected to be earnings enhancing for the Group in the financial year to 31 December 2016.   

 Total initial consideration of £27m is based upon a six times EBITDA multiple with the initial net cash consideration of £20.25m payable at completion, plus 5,348,804 of Epwin Group Plc shares (representing 3.78% of the enlarged share capital) at 126.2 pence, a price based on the average closing share price over a 28 business day period prior to completion, (the “Consideration Shares”).  Further consideration of up to £8.0m, dependent upon Stormking’s performance in the year to 28th February 2017 may be achieved and may be settled in the same ratio of cash to shares as the initial consideration. This is payable in May 2017.  Both the initial and deferred considerations will deliver the acquisition on a maximum multiple of 6 times underlying EBITDA for the relevant period.

 The Consideration Shares have been credited as fully paid and will rank pari passu in all respects with the existing 136,166,817 ordinary shares of 0.05 pence each in the capital of the Company in issue, including the right to receive all dividends and other distributions declared, made or paid in respect of such shares after the date of issue of the shares. The Consideration Shares are subject to a lock-in arrangement under which the Company must agree to any sale of these shares prior to 31 December 2016.  Any shares issued as part of the deferred consideration will be subject to a six month lock-in from the point of issue.

 Cash consideration will be met from existing banking facilities which were renewed immediately prior to this acquisition to increase available facilities initially to £50m.  The drawn facilities comprise an amortising 4 year term loan of £20m plus a revolving credit facility of up to £30m which matures in December 2019.

 Application will be made for the Consideration Shares to be admitted to trading on AIM and admission is expected to take place on or around 8th January 2016 (“Admission”).

 On Admission, the Company’s issued share capital will consist of 141,515,621 ordinary shares. There are no ordinary shares held in treasury. Therefore, in accordance with the FCA’s Disclosure and Transparency Rule 5.6.1, the Company confirms that following Admission, the total number of voting rights in the Company will be 141,515,621.

 Trading update 

 The Board announces that despite challenging market conditions in the RMI markets in the second half of the year, the Company’s profits for the year ended 31 December 2015 will be in line with market expectations.


Jon Bednall, Chief Executive Officer, Epwin Group said:

“I am delighted to announce the acquisition of Stormking Plastics and extend a warm welcome to the Group to the team there.  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.    The acquisition represents a further significant step in the development of the Group and is expected to enhance earnings in 2016.” 

Mark Stokes, Managing Director of Stormking Plastics Ltd said:

“Joining Epwin Group is excellent news for the future of Stormking Plastics, its employees and customers.  It will enable us to build on the strong foundations laid over more than 30 years by Gary and Barry and gives us the opportunity to expand our product range as well as develop further routes to market in the future.  It is business as usual for everyone at Stormking, now with the knowledge that Epwin is committed to supporting the continued development of the business and maintaining the development of the existing operations.”

Gary King and Barry Whitehall, the founders of Stormking Plastics Ltd said:

“The decision to finally bring to a close our involvement in Stormking Plastics was never going to be easy, but in Epwin Group 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. We look forward to watching with interest and to learning of the continued success of Stormking”

 Contact information


Epwin Group Plc

Jon Bednall, Chief Executive

Chris Empson, Group Finance Director


+44 (0) 20 7379 5151

Zeus Capital Limited (Nomad and Broker)

Nick Cowles / Andrew Jones / Jamie Peel

Dominic King / John Goold



+44 (0) 161 831 1512

+44 (0) 20 3829 5000


Tom Eckersley / Marina Burton


+44 (0) 20 7379 5151


Notes to Editors


About Epwin


Epwin is a vertically integrated manufacturer of extrusions, mouldings and fabricated low maintenance building products, supplying the RMI, new build property and social housing sectors.


Its operating divisions are organised to provide the most appropriate and relevant product offerings for its customers through its portfolio of market segment specific brands. 

The Company is incorporated and domiciled in the United Kingdom. It operates principally in the United Kingdom.




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