Ferguson revealed plans to separate its UK and US operations this morning while also announcing the departure of its boss.
The plumbing and heating giant said that it will demerge the company’s two arms, pending on shareholder approval, to create an independent listed company called Wolseley which will focus exclusively on customers in the UK.
Read more: Ferguson dips on concernsa over US market
Meanwhile, the Ferguson business will be focused solely on serving customers in North America markets.
Ferguson’s share price rose three per cent in early morning trading.
Chief executive John Martin will also step down in November, paving the way for Kevin Murphy, the boss of the firm’s North American arm, to replace him as the firm ramps up its ambitions in the US.
“The decision by Ferguson to spin off its UK operations, following the sale of its Scandinavian operations, means the firm is now almost a pure play on North America,” said Russ Mould, AJ Bell investment director.
He added: “Throw in the appointment of Virginia-based Kevin Murphy as the firm’s new chief executive officer as of 19 November, as John Martin steps aside after barely three years in charge, and Ferguson – which already reports its accounts in dollars – looks to be laying the groundwork for a shift in its listing from the UK to the USA.”
Today’s decisions mark the conclusion of a detailed review of the group’s assets over several years.
In a statement released this morning, Martin said: “The demerger will enable both Wolseley UK and Ferguson to focus on accelerating the execution of their independent plans, providing clear investment propositions for each business.
He added: “Wolseley UK has a strong market position, leading customer propositions and an experienced management team with significant opportunities for development in the large and fragmented plumbing, heating and infrastructure markets.”