Grafton Group - To acquire Dutch business Polvo for €131m

Davy Research
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Grafton has further diversified its regional and product mix with the acquisition of Polvo in the Netherlands. The deal is consistent with management’s aim to improve both the market position and margin profile of the group. Crucially, this is happening without stretching the balance sheet. We estimate that net debt/EBITDA will rise to just 0.3x following the deal. This financial muscle underpins our positive view on the stock.