Ferguson Selling Wolseley UK for $421.1 Million -- Update

--Ferguson expects to return most of the money from the sale of Wolseley UK to shareholders via a special dividend

--The company said it is selling its U.K. arm to focus on North America

--The sale is expected to complete by the end of January

By Ian Walker

Ferguson PLC said Monday that it is selling its U.K. arm, Wolseley UK, to private investment company Clayton Dubilier & Rice LLC for 308 million pounds ($421.1 million).

The plumbing-and-heating products distributor said it expects to complete the sale by the end of this month, and then return most of the money raised to shareholders via a special dividend.

"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," Chief Executive Kevin Murphy said.

The FTSE 100-listed company had previously said that it plans an additional U.S. primary listing in the first half of this year, after shareholder approval in July. The U.S. market generated around 86% of group revenues in fiscal 2020.

Shares at 1035 GMT were down 2 pence, or 0.02%, at 8,882.0 pence, after peaking at 9,018.0 pence earlier in the session.

In late 2019 Ferguson had said that it planned to demerge the U.K. business into an independent U.K.-listed company, but started looking at other options last September, citing uncertainty about the timing of a spinoff in the current economic environment.

The U.K. business generated revenue of $1.88 billion in fiscal 2020, and had gross assets at July 31 of $1.09 billion.

Write to Ian Walker at [e-mail]

(END) Dow Jones Newswires

January 04, 2021 06:08 ET (11:08 GMT)

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