LONDON, UK: Strix Group Plc (AIM: KETL) has entered into conditional agreements to acquire the entire issued share capitals of each of (i) Billi Australia Pty Ltd and Billi New Zealand Ltd and (ii) Billi UK Ltd for an aggregate cash consideration of approximately £38 million, payable on completion, on a debt and cash free basis, subject to customary closing adjustments.

The consideration for the acquisition will be funded through a new term loan and Strix is undertaking an equity placing to maintain an appropriate level of leverage post the Acquisition. The placing is being conducted through an accelerated bookbuilding process which will be launched immediately following release of this announcement.

Strategic rationale

• Materially changes the earnings profile of the Group, accelerating growth plans for the Water & Appliance categories and supporting the Group’s medium term ambition
• The Board expects the Acquisition to be mid single digit earnings accretive in the first full year of ownership and c.10% accretive in the second, in advance of any synergies
• Billi is benefitting from structural market and ESG tailwinds including increasing focus on water filtration, a reduction in single use plastics and a focus on energy consumption from heating water which is aligned with Strix’s sustainability goals
• Adds well developed and premium products in the high growth and strategically important hot tap market and increases Strix’s position and portfolio of water dispenser systems
• The Board expects Strix’s existing technology and expertise can be used to enhance Billi’s NPD roadmap
• Opportunity for further organic growth driven by increased residential sales, new product development particularly in sparkling, internationalising Billi’s revenue stream through Strix’s global footprint, cross selling Strix products into commercial applications and growing aftermarket sales
• Identified efficiencies across Billi’s product lifecycle through utilising Strix’s Chinese operation to improve procurement, using Strix filters in Billi products, consolidating the marketing group and rationalising the store estate

Mark Bartlett, Chief Executive of Strix Group plc, said: “We are delighted to enter this agreement to acquire Billi, a leading multifunctional taps manufacturer and distributor. Billi accelerates our strategy within our Water and Appliances categories which is core to Strix’s five year plan. We look forward to welcoming the Billi team to the Strix Group and working together to grow our combined businesses.”