ALUMASC, the building products group has announced the acquisition of ARP Group, a manufacturer and distributor of specialist metal rainwater and architectural aluminium goods, for £10m.

ARP marks the first acquisition by Alumasc since 2018 and demonstrates the Group’s strategy to supplement organic growth through acquisitions.

Paul Hooper, Chief Executive of Alumasc, said: “We are delighted to welcome ARP, along with all our new colleagues to the Alumasc Group. This acquisition aligns with our strategy of accelerating our organic growth with complementary bolt-on acquisitions. ARP will broaden the Group’s existing product offerings, and augment the routes to market for both businesses.”

Alumasc says it shares many qualities with ARP, including strong relationships with contractors which will complement Alumasc’s business model. ARP will broaden the Group’s existing product offerings, and add to its routes to market, bringing attractive scaling opportunities for both businesses.

ARP Group

ARP Group includes Aluminium Roofline Products Ltd, together with Rainwater Online Holdings Ltd and its subsidiaries Envelope Solutions Ltd and Cast Iron Superstore Ltd.

Based in Leicester, ARP was established in 1987, and operates from 4 facilities totalling 47,000 square feet, with a team of 70 experienced staff.

ARP’s results for the year ended February 2023 showed revenue of £10.8m and EBITDA of £1.3m. Consolidated net assets were £4.5m.

The acquisition agreement comprises an initial £8.5m, payable at completion, and an additional payment capped at £1.5m, payable subject to ARP’s performance over the two years ending November 2024.

The acquisition multiple based on the initial consideration is approximately 6.8x, which is expected to reduce to below 5.0x over the medium term, assuming full payment of the earn out consideration, and achievement of expected operating synergies. ARP is expected to generate earnings immediately.

The ARP acquisition remains conditional upon the UK Competition and Markets Authority agreeing it and is expected to complete by the end of October 2023.

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