The Edel Group BV has been taken over by Victoria PLC from the UK.
Victoria PLC is an international designer, manufacturer and distributor of innovative flooring.
The integration of Edel with Victoria’s existing synthetic turf business will create the largest premium landscaping grass group in Europe with revenues of more than €77mln, the company said.
The flooring designer and manufacturer paid €49.4mln (£42.9mln) for the Dutch company, which generated revenues of €47mln (£41mln) and earnings (EBITDA) of €10mln (£8mln) in 2020 which represents an above 20% operating margin.
Victoria PLC funded the purchase price entirely from the Group’s cash balances.
Philippe Hamers, Group Chief Executive, commented: “Victoria’s 2017 investment in the premium artificial landscaping grass sector has been very successful and this acquisition represents an opportunity to create Europe’s largest and most profitable business in the sector. The addition of production facilities benefits our customers by enabling them to source locally in Europe, avoiding inflationary and disruptive imports from the Far East. Furthermore, the outlook for this product category is positive due to growing consumer acceptance and increasing demand for sustainable products that address climate change.”
Strategic rationale for the Acquisition
Edel has with state-of-the-art and well-maintained yarn extrusion, tufting and backing production facilities located in the Netherlands and Germany.
Established in 1918, the company primarily supplies artificial grass for domestic and landscaping purposes across Europe, a market in which Victoria already has a strong presence following its February 2017 acquisitions of Avalon and GrassInc. With European demand for artificial grass expected to achieve double-digit growth from 82.4m m2 in 2020 to 110.6m m2 in 2023 (AMI Consulting 2020), Victoria PLC anticipates to remain a high-growth sector. Additionally, Edel supplies carpet backing services utilising the same equipment.
Edel operates through three business units:
- Schramm, based in Rahden, Germany: yarn extrusion for synthetic turf;
- United Works, located in Genemuiden, Netherlands: tufting and backing of synthetic turf and backing of carpets; and
- Royal Grass, based in Uden, Netherlands: the marketing and sales of super-premium synthetic turf for landscaping and leisure end-markets.
The synthetic turf brand Edelgrass, a popular brand in synthetic turf for sports, is not used part of Edel Group.
As Victoria currently outsources the production of c.4 million m2 of synthetic turf, the company intends on capitalising on the manufacturing capabilities of Edel. By insourcing this production the margin on Victoria’s existing synthetic turf revenue will increase.
According to a statement issued by the company, Edel will continue to operate with a significant degree of autonomy under experienced and committed managers, whilst benefiting from being part of a much larger group in its ongoing drive for profitable growth.