Not much more than a month since it bought a Dutch artificial grass manufacturing company, global carpet and flooring company Victoria PLC has been shopping again.
This time the Kidderminster-headquartered company has bought North American bamboo flooring business Cali Bamboo expanding its distribution in the country further.
Cali Bamboo, which was established in 2003, manufactures green building materials, specifically bamboo, which can be continuously re-harvested without damage to the plant or its surrounding ecosystem.
In a statement, Victoria PLC, stated: “Cali is an exceptionally high-growth US-based business that has achieved an organic compound annual growth rate of 17 per cent for the past five years via its online B2C customer acquisition model, data-driven analytics, a high-touch consultative sales team, and direct delivery capability, alongside B2B channels.”
For the 12 months ended 30 April 2021, Cali generated unaudited total revenues of $171.6 million ( £124.3 million). Victoria paid US$76.1 million (£55.1 million).
The integration of Cali with its existing business will help Victoria’s US distribution, where the Group currently sells around $33 million of flooring each year.
The acquisition also gives Victoria access to the intellectual property and online management experience of Cali, which the Group will leverage to partner with its key retailers to accelerate growth in its existing UK, European, and Australasian markets.
Cali’s fast growing direct to consumer/contractor business is highly profitable on a first order basis and increasingly benefits from a growing mix of repeat professional customers (today 47 per cent of contractor/professional sales are repeat orders up from 28 per cent in 2017). The Cali lifestyle brand and sustainability-themed product portfolio also resonates with Millennials, the largest US demographic, now entering their peak home-buying years, added the Victoria PLC statement.
Philippe Hamers, Group Chief Executive, said: “Victoria has been successfully selling a significant amount of product into the $29 billion – and growing – US market for many years. The acquisition of Cali represents a step-change for the Group presenting both revenue synergies alongside meaningful exposure to the fast-growing online sales channel. We will also be using the knowledge and online systems developed by Cali to partner with our existing key retailers in the UK, Europe, and Australia to accelerate our growth and earnings in these markets.
“Cali has a very high-quality management team who are passionate about the business and the result is indisputable: it has been organically growing revenues at more than 17% annually for the last five years with strong operating cash conversion.”
Geoff Wilding, Executive Chairman, added: “Victoria has now invested a little over £160 million in the current financial year to add approximately £27 million of EBITDA to the Group. This is a significant acquisition for Victoria and helps towards our objective of increasing our commitment to North America where the practical support and deep sector experience of Koch Equity Development has proven invaluable.”
And Victoria is still hungry for growth.
Geoff added: “We continue to have substantial amounts of capital to deploy and are in active discussions with additional high-quality opportunities to grow our business. Therefore, shareholders can expect further acquisitions.”