Norcros – 18.25p

2 April 2013 – acquisition

The group has announced that it has acquired the private business Eurobath International for initial consideration of £11.0m in cash, plus debt estimated at £0.9m, with a further £4.1m potentially payable depending on the future performance of the business.  The acquired business trades as Vado and is a leading supplier of taps, mixer showers and bathroom accessories with strong brands and a broad customer base.  It supplies to contractors as well as the retail market with 45% of revenue derived overseas.  In the year to 31 December it made a pre-tax profit of £2.1m and the acquisition will expand the group’s product portfolio and geographic exposure.  Shares in Norcros have risen strongly since we recommended them last September at 11.875p.  Despite the strong rise in the share price the stock remains ATTRACTIVE.

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