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Please note that tax, investment, pension and ISA rules can change and the information and any views contained in this article may now be inaccurate.
Marshalls’ £535 million Marley deal set to ‘transform’ earnings growth

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Please note that tax, investment, pension and ISA rules can change and the information and any views contained in this article may now be inaccurate.
Building products group Marshalls (MSLH) has taken a big step towards its strategic goal of becoming the UK’s leading maker of building products with the £535 million acquisition of Marley.
Marley, a leading supplier of roofing products, is highly profitable, generating an EBITDA (earnings before interest, tax, depreciation and amortisation) margin of over 20% throughout the pandemic, above Marshalls’ own margin.
The purchase price, which represents a multiple of 10.7 times EBITDA, isn’t expensive for a business which will boost Marshalls’ earnings growth by double digits in the first full year after completion.
The deal looks well-timed too, given the continued strength of the repair, maintenance and improvement market and the boom in demand for new housing.
Marshalls is financing the purchase through a mixture of cash and new equity which means an increase in the number of shares in circulation.
Crucially, Marley’s long-standing management team will remain with the business and they are not allowed to sell their new shares in Marshalls for six months.
SHARES SAYS: The acquisition makes strategic and financial sense. Keep buying the shares.
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