Ferguson shares edge up after €1bn Nordic arm sale

by

Wolseley changed its official name to Ferguson earlier this year

UK plumbing giant Ferguson has sold its Nordic arm to private equity firm Lone Star in a billion euro deal.

The FTSE 100 firm, formerly known as Wolseley, announced the €1.03bn (£900m) sale this morning.

Advisers on the deal are in line for a bumper €50m payday, Ferguson revealed.

The deal is part of sweeping changes being implemented by Ferguson to focus on its more profitable US arm.

Ferguson chief executive John Martin said the sale represented a "good outcome" for shareholders.

He added: "[The sale] will enable us to continue to focus on our strategy of accelerating profitable growth in our plumbing and heating businesses."

Shares in the 130-year-old firm edged up one per cent in early trading.

Read more: Ferguson rewards investors with 'huge dividend' and £500m buyback

The sale is subject to sign-off by competition authorities, with the expectation that it will complete in early 2018.

Last month, Ferguson hailed the success of its US revamp, rewarding shareholders with bumper payouts.

Reporting its full-year results, Ferguson hiked its dividend by 10 per cent and revealed plans to return £500m to investors through a share buyback scheme.

The world's largest heating and plumbing distributor, best known in the UK for its Plumb Centre operations, changed its name from Wolseley this year to that of its US subsidiary Ferguson.

Faced with challenging UK market conditions, the firm unveiled the closure of 80 UK branches with the loss of 800 jobs in September 2016 as part of a "transformation process".

Read more: Wolseley to cut 800 jobs and shut 80 branches across the UK