RWC to acquire Holman Industries

by | Feb 20, 2024

Wally Edwards – Holman Industries.

Reliance Worldwide Corporation (RWC) Limited has entered into an agreement to acquire Holman Industries for A$160 million. The business is being acquired from interests associated with Holman’s founder Walter (Wally) Edwards.

Holman is a leading independent manufacturer and distributor of branded plumbing and watering products sold through retailers and wholesalers in Australia. Holman generates approximately 50 per cent of its revenues from sales of “water-out” plumbing products focused on drain, waste, and vent (DWV) solutions, stormwater fittings, and PVC pressure fittings. The remaining revenues are generated by sales of watering products including a range of hose systems, fittings, timers, and garden products in retail and hardware.

Holman achieved net sales of A$192 million and Adjusted EBITDA of A$22.9 million for the 12 months ending December 31, 2023. The acquisition of Holman is expected to double RWC’s annual net external sales in its Asia Pacific (APAC) region to approximately A$360 million.

RWC predicts that the net sales for the APAC segment in the current financial year (ending 30 June 2024) will increase by approximately A$50 million. This increase reflects a part-period contribution from Holman.

The acquisition will be debt-funded utilising RWC’s existing committed borrowing facilities. RWC’s pro-forma leverage will increase to 1.90 times after the acquisition, compared to 1.69 times as of 30 June 2023.

Holman’s founder Wally Edwards has agreed to remain with the business for two years following completion of the acquisition.

RWC believes the acquisition of Holman will provide additional sales growth opportunities from an expanded product portfolio, coupled with a much broader retail channel partner and distribution footprint in Australia. In addition to revenue synergies, RWC also expects to achieve cost savings of approximately A$5 million per annum on a run rate basis by the end of the third year through distribution footprint rationalisation and optimisation.

RWC Chief Executive Officer, Heath Sharp said the acquisition of Holman aligns with RWC’s growth strategy and will enhance its market position in Australia.

“Product innovation coupled with high levels of customer service have been instrumental in driving Holman’s growth. This is strongly aligned with RWC’s approach to growing its business,” Mr Sharp said.

“The acquisition of Holman provides RWC with immediate and substantial access to the Australian water-out segment, allowing us to strengthen our overall offering and be an even better partner to our core plumbing wholesalers in Australia. Entering the water-out market is a strategic priority in each of our three regions.”

Mr Sharp said that while RWC had looked at other opportunities globally, Holman marks their first foray into this end market. RWC expect it will help lead and catalyse their approach in other markets globally.

“Holman also gives RWC significantly expanded access to the retail channel in Australia. This will provide us with the opportunity to grow our legacy RWC products within retail while also putting more scale and manufacturing capability behind Holman. We believe Holman’s success is linked to its genuinely world-class execution capabilities into retail and hardware,” he said.

“This acquisition will allow us to utilise Holman’s retail operational capabilities in other parts of the world, while also enabling us to look for opportunities to bring our US retail market expertise to Australia.”

“We are delighted that Holman’s founder Wally Edwards is going to remain with the business in an advisory capacity. Wally has built a really strong team, and we see a significant amount of very capable talent within Holman that will augment RWC’s global capabilities,” Mr Sharp said.