European supplier of specialist building product SIG plc has agreed to sell VJ Technology (VJT) to Primary Capital, a UK private equity investment firm, following a competitive disposal process.
VJT is a UK distributor of technical fixings, fasteners and consumables to the infrastructure, commercial and wider construction industry, and part of SIG Distribution.
The sale comes as SIG is disposing of smaller, non-core businesses in order to refocus the Group’s portfolio and strengthen its balance sheet. The strategy review undertaken last year identified VJT’s niche product offering and operating model as being very different to that of the main SIG businesses.
VJT reported sales of £31m last year. Profit before tax was £5m with operating cash flow of £4.1m. The gross assets of VJT as at 31 December 2017 were £16.4m. The consideration from the sale is expected to be approx £29.7m, resulting in a gain on sale of approx £7.4m.
Completion is expected on or before 30 June 2018.