Cerezzola Limited (BidCo), a wholly owned subsidiary of leading European sofa retailer Poltronesofà, is set to acquire the UK's second-largest upholstery retailer, ScS, for approximately £99m.
The ScS board has recommended that ScS' stockholders accept the offer, which will be further detailed in the retailer's audited financial results for the year ended 29th July 2023, the publication of which has been postponed to this Wednesday.
Under the terms of the acquisition, ScS shareholders will receive 280p for each share, including a dividend of 10p per share payable in December.
Alan Smith, non-executive chair of ScS, says: "This cash offer, which the ScS board unanimously recommends, comes at an attractive valuation. It recognises the quality of the ScS Group's operations, its cash resources, and the progress accomplished under Steve Carson's leadership via his refreshed strategy.
"Poltronesofà, based in Italy, is a pan-European sofa retailer that has been successfully pursuing international expansion and ScS, with UK operations, is the next juncture of that strategy. The ScS board believes Poltronesofà will bring significant benefits to ScS through its broad industry expertise in addition to providing the necessary capital that would accelerate our current strategy, albeit in a private rather than public sphere. The acquisition will enable ScS to continue as part of a broader, pan-European entity in pursuit of its strategy and position it for long-term success in the UK."
Renzo Ricci, CEO of Poltronesofà, comments: "As the next step of Poltronesofà's pan-European expansion, the acquisition represents the best opportunity for Poltronesofà to enter the UK market of upholstery products. Poltronesofà believes it is strategically very well placed to support ScS in the next stage of its development, and by building on the combined industry knowledge and experience and providing the necessary capital to accelerate ScS's ambitions, the acquisition will help ScS realise its full growth potential."
Established in 1995, Poltronesofà designs and sells sofas, armchairs, sofabeds and decorative accessories, and sells them through its 167 stores in Italy, 106 stores in France and 27 further stores across Europe. BidCo is a private limited company formed for the purposes of implementing the acquisition.
ScS (also owner of the Snug brand) operates 100 UK stores and a growing ecommerce platform.
The acquisition is expected to come into effect in Q1 2024.
