Source: Stealth
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  • Stealth Group Holdings (SGI) agrees to buy United Tools (UTL) for $24,000 and a deferred market subsidy of $1.25 million over two years
  • United Tools is one of Australia’s largest buying and distributing co-operatives of independent retailers
  • This purchase will expand SGI’s Australian retail footprint, buying power, and market position
  • Once United Tools has been under Stealth for one year, based on recent sales growth, the company is expecting its Australian operations to reach more than $100 million
  • On the market today, Stealth finished the 13.8 per cent in green, to 16.5 cents

Stealth Group Holdings (SGI) has agreed to buy United Tools (UTL) for $24,000 and a deferred market subsidy of $1.25 million over two years.

United Tools is one of Australia’s largest buying and distributing co-operatives of independent retailers, selling tools, industrial and trade-related products to business and retail customers.

This purchase will expand SGI’s Australian retail footprint, buying power, and market position.

Stealth’s physical store network will more than double from 33 to 66 across Australia, with six online marketplaces, this will make it one of the largest distribution networks of company-owned and independent retail combinations in Australia.

UTL’s FY21 revenue sat at $8 million, with an earnings before interest, taxes, depreciation, and amortisation (EBITDA) of $300,000.

Stealth’s Managing Director and CEO, Mike Arnold, labelled the UTL deal “compelling”.

“It complements Stealth’s existing business and delivers strong outcomes to our shareholders and stakeholders with our enhanced attractive business model,” Mr Arnold said.

“United Tools is highly synergistic, with a robust product offering and value-added service capabilities, an extensive MRO-specific distribution store network throughout Australia and an experienced salesforce that enhances the strong team Stealth has in
place.”

“Stealth continues to develop as a business and further enhance its value-added proposition to customers. This includes better experiences through wider ranges, best prices, national distribution footprint, robust eCommerce channels, deeper supplier
relationships and unmatched service,” he concluded.

Mr Arnold will give an address and presentation on this acquisition on Tuesday, February 8.

Trading update

Stealth has also provided an initial trading update ahead of releasing its final reviewed results from the first half of FY22 in late February.

Provisional sale figures show that the company achieved record growth in the half-year with first-half sales of around $46.5 million, up 53 per cent on 1H21 and 18.5 per cent on 2H21.

Once United Tools has been under Stealth for one year, based on recent sales growth, the company is expecting its Australian operations to reach more than $100 million.

On the market today, Stealth finished the 13.8 per cent in green, to 16.5 cents.

SGI by the numbers
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