2 September 2015 – acquisition
The group has expanded its product range with the acquisition of leisure products business E.S.C. (Europe) Ltd for initial consideration of £2.1m subject to adjustment for the value of net assets acquired. ESC is a leading online retailer of gazebos, party tents, household, kitchen and fishing products under a number of brand names. It generated profits of £0.4m in the year to 31 October 2013. The purchase is to be funded with cash from the group’s own resources and a loan from HSBC. The acquisition will complement the group’s existing ecommerce offering and is expected to be earnings enhancing in its first full year of ownership. We believe this is a sound acquisition and that it will strengthen the group’s overall offering. We continue to believe that the shares are too cheap and maintain our recommendation of BUY.