Kesko to acquire Fresks Group to strengthen market position in the building and technical trade in Sweden
Kesko Group company K-rauta AB has signed an agreement to acquire Fresks Group, a significant operator in the Swedish builders’ merchant business. Fresks Group is the largest member in the XL Bygg chain. The acquisition implements Kesko’s building and technical trade division’s growth strategy in Northern Europe. It will also significantly strengthen Kesko’s market position in Sweden, especially in the growing professional builders customer segment.
In the building and technical trade, Kesko’s strategic objective is to strengthen its market position in Northern Europe and improve its profitability in all operating countries. In an effort to considerably strengthen its market position in Sweden, the company has decided to acquire Fresks Group from Litorina, Oscarson Invest and the group’s management. The purchase price of the acquisition expressed on a debt and cash free basis is some €200 million.
Kesko will obtain Fresks Group, which operates 33 stores with a strong market position in Sweden and employs approximately 500 people who mainly serve professional small and medium-sized renovation companies. The pro forma net sales of Fresks Group totalled €205 million and comparable pro forma EBITDA €18 million in 2018.
“Building and renovation are increasingly assigned to professionals in Northern Europe. The acquisition of Fresks Group raises us among the market leaders in Sweden and makes us a significant operator in B2B trade. Fresks Group’s operations are highly complementary to our current building and home improvement trade operations in Sweden and offer us significant economies of scale and synergies. The Swedish building and home improvement trade market is undergoing structural changes, and this acquisition strengthens our position in the consolidating market. We will continue to develop our building and home improvement trade and technical wholesale business in Northern Europe in line with our growth strategy,” says Mikko Helander, Kesko’s President and CEO.
K Group is one of the leading operators in Northern European building and technical trade, with operations in eight countries. In 2018, the building and technical trade division’s pro forma retail sales in Northern Europe totalled €4.9 billion.
The completion of the acquisition is subject to the approval of the Swedish competition authorities and the fulfilment of the other terms and conditions of the transaction.
Jorma Rauhala, President of the building and technical trade division, Deputy to President and CEO of Kesko Corporation, tel. +358 105 322 211, email@example.com
Jukka Erlund, Executive Vice President, Chief Financial Officer, tel. +358 105 322 113, firstname.lastname@example.org
Media: Jessica Diktonius, Director, Communications, K Group's building and technical trade, +358 40 709 9176, email@example.com
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