Wickes Acquisition of Solar Fast

WICKES GROUP plc has agreed to acquire 51% of the issued share capital of Gas Fast Ltd, parent company of solar installations company Solar Fast.

Solar Fast focuses on solar panel installations, alongside a smaller business installing gas boilers.

The acquisition will enable Wickes to expand its offering into the fast-growing market for home energy solutions, initially with solar and gas boilers and, in time, air source heat pumps and other services.

Wickes says the UK market for domestic solar installations is highly fragmented and is expected to significantly expand from an estimated £1.1bn in 2024 to £1.5bn in 2028. The growth comes as homeowners and landlords retrofit their properties in order to save energy costs and reduce their environmental impact.

Wickes’ Solar Fast acquisition enables it to expand its range of Design & Installation services.

David Wood, Chief Executive of Wickes, said: “This acquisition enables us to accelerate our Design & Installation growth lever, capitalising on our expertise in installing major home improvement projects.

“The Wickes brand has been trusted by home improvers for over 50 years and with Solar Fast as part of our proposition we will be perfectly placed to support them with their energy saving plans.

“I’d like to take this opportunity to welcome David Draper and his impressive team to the Wickes family and we look forward to delivering our exciting plans together.”

Solar Fast will be fully consolidated into Wickes and the acquisition is cash generative and profitable and is expected to be immediately accretive to group profits.

Over 2022 and 2023 Solar Fast installed 3,700 solar projects in domestic properties. In the 12 months to 30 April 2023 the business generated revenue of £33.1m and reported profit before tax of £3.9m.

David Draper, Founder and CEO of Solar Fast, commented: “This is tremendous news for Solar Fast. We’re a family business and our vision has always been to become the number one provider in the UK for quality domestic solar installations and with the Wickes brand behind us, we are closer to achieving that vision.

“I, along with all of the Solar Fast team, are very much looking forward to being part of the Wickes family and to working together to make UK homeowners more energy independent.”

Acquisition of Solar Fast

The solar market experienced a short-term peak in demand during the energy crisis of 2022/2023 lowering expectations of market demand and Solar Fast’s revenue in 2024 before returning to growth. As of 30 April 2023 the Business had gross assets of £5.9m and net assets of £3.8m.

Wickes will acquire the 51% equity stake from the Solar Fast founders based on a valuation for 100% of the Business of 7x EBITDA delivered in calendar year 2024. The acquisition’s minimum valuation for 100% of the business is £10m-£36m, on a debt-free, cash-free basis. Wickes will pay £5.1m at completion of the transaction as a minimum payment for the 51% equity stake, with the balance to be paid in early 2025. Wickes will fund the purchase price from existing cash reserves.

Wickes has an option to purchase the remaining 49% of the issued share capital of Solar Fast. This option may be exercised during the five years following completion, in tranches of not less than 10% of the issued share capital, and is based on a pre-agreed valuation based on 6x LTM EBITDA at the time.

The founder and CEO of the Business, David Draper, will continue to lead the business in collaboration with the Wickes team.

Since the Business offers financing solutions to customers and is regulated by the FCA, the transaction will be subject to FCA approval. Approval is expected to be granted in the coming weeks.

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