MERCHANT FOCUS: HUWS GRAY
THE WELSH NATIONAL
Double in size every five years? Done that. Double in size overnight? Done that, twice. Fiona Russell Horne talks to Huws Gray about getting bigger while staying true to your roots.
W 18
hen is a national business not a national business? When it retains the heart and soul of an independent, perhaps?
That may be the idea at Huws Gray, the Anglesey-based builders merchant group that announced last month it had agreed to acquire the 200 or so branches that made up Grafton GB Merchanting’s traditional merchanting businesses. The deal takes the Welsh merchant to 315 branches and a turnover somewhere north of £1.5bn, just 31 years after the business was launched with one branch in Anglesey, and 26 years after its first acquisition.
None of the company’s recent growth by acquisition would have been possible without the backing and support of Blackstone, Huws Gray’s current private equity partners, as
managing director Terry Owen explains. “When we started the business in 1990, we knew that we would have to have an exit route. No-one is going to live for ever, and so you have to know what your exit plan is. We always thought ours would be via a trade sale, and, over the years, we thought that Grafton would probably be the best custodian for our business. So, we met with them a few times, but it was just never the right time. Most merchants will have sat down to consider selling their business at some stage.” In this industry, however, things don’t often pan out the way you expect them to. Owens says the company decided about six years ago that a trade sale wasn’t the way they wanted to go. “We felt that we had something a bit special, and that there would be an opportunity in this country to
put together something quite substantial for the long term.” So, they did. When, in 2018, Huws Gray brought in private equity partner Inflexion, it was to safeguard the business without selling it. “We were able to give our own shareholder families a bit of security and also ensure longevity to the business.” The private equity partnership gave the company the confidence to continue its policy of acquiring small, like-minded independents, but also when the opportunity arose, to effectively double in size overnight when East Anglian merchant group Ridgeons came on the market. That deal brought Ridgeons’ CEO Ian Northen into the same role at Huws Gray. He says: “Our story for private equity has always been about growth by acquisition and the scale of the opportunity and potential that exists in this country. This Grafton opportunity just gets us there a bit more quickly.” The deal with Grafton brings into the Huws Gray fold the businesses that currently operate under the Buildbase, Civils & Lintels, PDM Buildbase, the Timber Group, Bathroom Distribution Group, Frontline and NDI brands. He points out that most of the businesses that made up this part of Grafton were independently owned merchants in the first place. “That’s one of the reasons why this acquisition is such a good cultural fit. Plus, it’s helpful that many of the people in the business have been there a long time and have so much experience. I think it will be welcomed by everyone who is coming on board. As a business we have always been
www.buildersmerchantsjournal.net August 2021
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