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Thu October 21 2021

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Cairngorm consolidates its builders' merchant acquisitions

20 Sep Cairngorm Capital Partners has merged two of its portfolio companies, Grant & Stone Group and Independent Builders Merchant Group (IBMG).

RGB's branch in Okehampton is now one of 123 within the consolidated IBMG group
RGB's branch in Okehampton is now one of 123 within the consolidated IBMG group

The combined business is a builders’ merchant group with 123 branches, 1,700 employees and revenues topping £500m.

The new group extends from Cornwall to Kent and comprises builders’ merchants, electrical wholesalers, plumbers’ merchants, kitchen and bathroom showrooms, roofing merchants, a timber processing yard and an ecommerce business.

Independent Builders Merchant Group has been built up through the acquisition of Parker Building Supplies by Cairngorm Capital in March 2018, followed by the bolt-on acquisitions of Stamco and Fairalls and merger with Chandlers Building Supplies in 2019. Backed by Cairngorm, the original Parker business has grown from 15 branches and revenues of £67m, to 39 branches and revenues of more than £200m.

Separately, Cairngorm bought High Wycombe-based Grant & Stone in November 2019 and since added to it 3Counties in Buckinghamshire, CRS Building Supplies (12 bracnhes in Somerset), Rawle Gammon & Baker (RGB – 22 branches across Devon, Cornwall and Somerset), as well as smaller West Country traders Buildit and Total Plumbing Supplies.

Thus in less than two years Grant & Stone has grown from 29 branches in the Thames Valley and revenues of £100m to 84 branches extending from London to Cornwall, generating revenues in excess of £300m.

Cairngorm Capital said that bringing the two businesses together was “the natural evolution for both companies” and that it created “a solid platform for continued growth, new market entry and further M&A activity”.

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The new combined company will be known as Independent Builders Merchant Group (IBMG) but the individual brands of all the acquired companies are being kept as trading names for all customer-facing activity, for the sake of market recognition.

Grant & Stone group chief executive Nick House leads the new combined IBMG business, with Peter Cudd as group managing director. They will be supported by a new group board, with David Moore as non-executive chairman and executive directors Allun Pittingale (managing director for IBMG Southeast), Kevin Fenlon (projects director and chief executive of RGB) and Richard Robinson (chief financial officer).

Cairngorm Capital managing director Alex Bayliss said “Today’s merger is the logical outcome of a strategy that we have been advancing since our initial acquisition of each company. Both are really great businesses, each with an exceptional leadership team that has the talent and the appetite to lead an enlarged company.”

Group chief executive Nick House said: “This merger is the natural progression for both companies. Our branch networks and product ranges are highly complementary and our values, vision and commitment to customers are completely aligned, which creates exciting opportunities for us all. We have ambitious goals to fulfil but IBMG is well structured, with strong investor support, exceptional products, first-rate employees and a well-deserved reputation for superior service. I look forward to leading the next phase of development.”

Cairngorm Capital also owns Scottish timber merchant Thornbridge, North Yorkshire Timber, Rembrand Timber, Arnold Laver and door maker Cotswold Manufacturing. These form the National Timber Group and remain held separately.

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