The agreement for an acquisition by One51 was announced on May 2 2014 with Straight shares to be paid for at 78p in cash valuing the business at £10.7 million.
One51 has already secured 48.7% agreement for the sale and Straight shareholders will now be asked to approve the deal at a Court meeting arranged as part of the sale process.
‘Leading’
The One51 group also has bin manufacturer Rotherham-based MGB Plastics in its portfolio and which is described by the group as “the UK’s leading manufacturer of wheeled bins and kitchen caddies and other recycling containers”.
Explaining the reasons for the acquisition plan, One51 noted: “Having established itself as a leading player in the UK wheeled bin market via its subsidiary which traded as MGB Plastics, One51 wants to build upon this success by undertaking complementary strategic acquisitions in the UK.
Moustache
Straight’s chief executive is Jonathan Straight, 48, after whom the business is named and who is renowned for sporting a handlebar moustache. He started the company on his own, sharing an office in Leeds with a community group.
One of his major achievements has been the development of a manufacturing site in Hull and turning this into a profit-making operation as well as selling caddies and containers to numerous UK local authorities. Straight has also become a large player in the compost bin and water butt market.
The business has faced some tough times in recent years but in its results posted on April 17 2014 for the calendar year 2013, it showed an increase in earnings before tax to 1.99 million compared to 750,000 for 2012.
Integration
Commenting on the agreement to buy the business, Alan Walsh, chief executive of One51 Group said: “The board of One51 Group looks forward to the integration of Straight within its existing plastics division. We aim to support Straight in its growth plans by providing the security of a strong balance sheet and continuing to innovate the business model through investment in technology and machinery.”
Mr Walsh added: “The combination of One51 and Straight is an exciting opportunity as it adds considerable breadth, depth and scale to One51s existing offerings, creating a leading specialist injection moulding group in the UK which can then grow into other European markets. This acquisition will also drive growth for the Enlarged Group driving further value to our shareholders.”
Premium
James Newman, chairman of Straight, said: “The board of Straight is pleased to have agreed terms with One51. We consider that the offer represents an attractive premium to the average share price of Straight in the period prior to the announcement of a potential offer. We welcome the opportunity to join One51 which we believe will bring immediate and long term benefits to our clients and staff.”
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