Fasadgruppen Group AB Expands into UK Market with Acquisition of Clear Line Holdings Ltd

Fasadgruppen Group AB (publ) has announced the acquisition of Clear Line Holdings Ltd and its subsidiaries, further solidifying its position as a major European player in facade services.

The transaction, valued at £119.9 million on a cash and debt-free basis, consists of £51.1 million in cash, £15.3 million in loan notes to be exchanged for new Fasadgruppen shares, and shares in a newly established UK entity worth £53.4 million.

Clear Line, founded in 1997, is a leading full-service facades contractor in the UK. The company has specialised in the design, installation, and project management of complex facade solutions, particularly excelling in fire remediation projects.

With significant expertise and a proven business model, Clear Line has garnered strong relationships with consultants, property managers, and developers. For the twelve months ending June 2024, Clear Line reported net sales of £48.9 million and an adjusted EBITA of £21.7 million.

This strategic acquisition marks Fasadgruppen's entrance into the UK facade market, valued at approximately £10.5 billion annually. The market is buoyed by energy efficiency upgrades, basic maintenance needs, and crucial fire remediation projects following the 2017 Grenfell Tower tragedy. The remediation segment alone is projected at £1.5 billion per year for the next 14 years, with 14,600 residential buildings identified for necessary upgrades—only 1,400 of which have been completed to date.

Clear Line's strong market presence, alongside its 60-strong workforce in project management and construction, positions Fasadgruppen to leverage further consolidation opportunities.

The acquisition complements Fasadgruppen's Nordic operations, reinforcing its decentralized model and fostering growth in the competitive UK facade industry.

The group is set to issue shares for the £15.3 million loan notes at a price determined by the average stock value on Nasdaq Stockholm from 30 October to 5 November 2024, with more financial details forthcoming in the company's third-quarter update.

Martin Jacobsson, CEO of Fasadgruppen, said: "In Clear Line, we have found a unique player with a proven business model that has built an excellent market position in its clear niche and thereby achieved an attractive financial profile.

"The company's total solution, which helps the customer all the way from planning to execution and documentation with the support of a sophisticated IT platform, has made Clear Line a sought-after contractor among property owners who need to upgrade their facades.

"We are confident about Clear Line's growth opportunities and look forward to our future expansion with Clear Line as one of our bright shining stars.

"Clear Line provides Fasadgruppen with a platform for further growth in the UK, whose facade market has many niche players that would fit well into Fasadgruppen's decentralised model.

"The UK market is an attractive complement to the Nordic region, and the combination of the two gives us very good opportunities to create returns going forward through both value-creating acquisitions and operational progress."

Peter Hebb, Managing Director of Clear Line, added: "In seeking new ownership, we sought to find a committed owner who understands and has the same passion for the building envelope industry as we do, we also sought scale that matches our ambitions.

"In both regards, Fasadgruppen provides a perfect fit for Clear Line.

"With their support we can expand our offering to larger portfolios where turnover limits might otherwise preclude such expansion, enabling us to access more projects with both existing and new clients in the UK.

"We particularly liked Fasadgruppen's approach in bringing market expertise and financial strength while enabling our own successful business to continue operating as before.

"Under Fasadgruppen's eternal ownership horizon, we will have a common interest in Clear Line continuing to develop its capabilities in an entrepreneurial environment with a focus on continuous improvement."

Source: Press release