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(Sharecast News) - Norcros announced on Tuesday that it has agreed to acquire Fibo Holding, a leading Norwegian supplier of waterproof decorative wall panels, in a deal valued at NOK 618m (45m).
The London-listed firm said the acquisition marked a strategic expansion into continental Europe and would strengthen its position in the fast-growing wall coverings segment.
Founded in 1952, Fibo generated net sales of NOK 856.3m and EBITDA of NOK 100m in the year to 31 December.
Around 70% of its revenue came from mainland Europe, with the remainder from the UK.
The company is led by CEO Anders Carlson, who would join Norcros as part of the deal.
It said the transaction remained subject to clearance from the UK Competition and Markets Authority, which was expected to take three to four months.
Once complete, Fibo would operate as an autonomous unit within Norcros.
The deal would be financed through the group's existing 130m revolving credit facility, with leverage expected to rise from 0.8x to 1.6x before declining thereafter due to strong cash flow generation.
"This strategically aligned acquisition gives Norcros a strong platform to accelerate our geographic expansion in this attractive, fast-growing segment of the wall coverings market," said Thomas Willcocks, chief executive of Norcros.
"Decorative wall panels is a product category that we understand well following our acquisition of Grant Westfield in 2022.
"Fibo Group has an excellent and well-established management team, a well-invested modern operation, and importantly, a reputation that aligns with our culture."
Norcros said Fibo would complement its existing UK panel business, Grant Westfield, acquired in 2022.
Together, the two would generate over 100m in revenue and operate in a segment gaining share from traditional tiling.
The acquisition was expected to be materially earnings accretive in the first full year of ownership, and deliver returns in excess of the group's cost of capital.
"We are excited to be joining Norcros and driving forward with the next stage of our growth plan," commented Anders Carlson, CEO of Fibo.
"We share a common understanding of the growth potential and sustainability benefits of decorative wall panels as an emerging alternative to tiles and together, we will be able to realise the benefits of scale."
Norcros said the acquisition would open the door to further expansion across Scandinavia and central Europe, including opportunities to cross-sell the wider bathroom portfolio through Fibo's established distribution networks.
At 1141 BST, shares in Norcros were up 7.64% at 296p.
Reporting by Josh White for Sharecast.com.