Victoria PLC makes third acquisition in Spain with Ibero

The UK multinational is expanding its presence in the ceramic sector, where it already operates with Ceramica Serra in Italy and Keraben and Saloni in Spain.

On 6 August, Victoria PLC, a UK-based flooring production and distribution multinational with its core business in the carpet sector, announced the acquisition of Ibero, a well-known Spanish tile manufacturer based in Castellón.

This is the third acquisition by the London Stock Exchange-listed group in the Spanish ceramic district following the purchases of Keraben in November 2017 (value 274 million euros) and of Ceramica Saloni in August 2018 (96.7 million euros).

Victoria’s operations in the ceramic industry also include Ceramica Serra in Italy, the first acquisition made by the group in November 2017.

Founded in 1958 by the Carnicer family, Ibero manufactures high quality porcelain ceramic flooring, which is sold throughout Europe, North America, and the Middle East. In 2018, Ibero generated audited revenues of 30.9 million euros and adjusted EBITDA of 3.1 million euros. The purchase price for the acquisition is split into two payments: the first, equivalent to approximately 3 times EBITDA, is to be paid on completion (“Completion Payment”); the second, which is to be paid in May 2020, is subject to Ibero meeting a specific performance target (“Contingent Consideration”): assuming the Contingent Consideration is paid in full, the purchase price for the acquisition would represent a multiple of less than 5 times EBITDA for the 12 months prior to completion.

As confirmed by Geoff Wilding, Chairman of Victoria PLC, the acquisition of Ibero will bring the group immediate earnings and will create operational synergies with Victoria’s existing businesses in Spain, where Ceramica Saloni is now fully integrated within the Keraben operation one year after its acquisition.

Victoria PLC’s expansion in the ceramic sector is part of an organic growth strategy aimed at diversifying and internationalising its operations with a view to becoming a multinational flooring group. When this latest acquisition is complete, over 75% of Victoria’s earnings would be generated from outside the UK, said Wilding.

In the tax year to 31 March 2019, Victoria PLC posted consolidated revenues of £574.4 million (up 35.2% on the £424.8 million of the previous year) and 44% growth in operating profit to £70.3 million. The ceramic business is becoming increasingly important for the group, accounting for 34% of its total revenue (£193.9 million) and 67% of operating profit (£48.2 million). In the year to 31 March 2019, Victoria PLC produced 27.7 million sq.m of ceramic tiles.