News & Analysis

Plumbing the depths of potential wealth on London Stock Exchange

Andrew Saks, Wednesday, 2 June 2021

This month, a whole new horizon has appeared in the United Kingdom. A seemingly extended winter has suddenly given way to a bright and warm summer, and the previously rare sight of human beings adorning the green and pleasant land en masse has suddenly become commonplace.

Just as it is fair to say that the majority of people will likely never take their personal freedom for granted ever again, enthusiasm for investment and business strength is burgeoning.

The London Stock Exchange, one of the world's most prestigious executing venues, has become absolutely hot property in the aftermath of a crippling lockdown to the extent that privately held companies whose founders are still in control are forming an orderly line to list for very large sums.

IPOs are once again the order of the day, and perhaps interestingly the companies wishing to list are not all hipster-led applications or internet-based tertiary service sites.

Rather they are traditional businesses offering traditional trades.

Victorian Plumbing, a supplier of bathroom fittings which is based in Liverpool, is one of the companies which has its sights on offering its shares for public sale on the London Stock Exchange, with the company hoping to raise £920 million in doing so.

The company was founded 21 years ago by Mark Radcliffe, who is now only 42 years old and who holds a 74% stake while his brother Neil has 14% and his mother 4%.

Current estimates have revealed that the valuation for the company upon its IPO could be as much as £1 billion, hence the £920 million estimate for its current owners.

Traditional trades and the world of public listings were once poles apart, and during the home improvement boom of the 1980s, newly-empowered home owners and the tradesmen which worked tirelessly to renovate them to a high standard could draw only the single common value in that they were both the definition of Thatcher's generation.

Tradesmen had traditionally been exactly that - skilled at their profession but with no interest in working with corporate advisors, and any mention of the City and its 'suits' would have been quickly brushed off in favor of a lunch break in the van with a copy of The Sun and a neatly foil-wrapped egg sandwich for lunch.

Those days are long gone, and the entrepreneurial spirit that underpinned the return to affluence of Great Britain has now brought the City and the tradesmen together, and Liverpool-born MR Radcliffe is no exception as he is already a millionaire after he set up First2save, a mobile phone accessories business from his parents' shed.

Upon admission to the stock market, former William Hill chief executive Philip Bowcock will be appointed chairman. Damian Sanders, who is a board member at Cineworld and The Hut Group, will also become a non-executive director.

The firm recorded revenue of £208.7m and earnings of £26.2m in the year to September 30. The company's latest accounts show that in the six months to March 31 this year it achieved revenue of £140.7 million in revenues, and earnings of £20.1 million.

Mr Radcliffe this morning made a press statement, saying "'We work hard every day to make sure we are providing consumers with the largest choice of quality bathroom products. Our approach is industry leading, as evidenced by our substantial and growing market share", and it has been confirmed that GCA Altium is acting as adviser while Barclays Bank and Numis Securities are also involved.

Given the attraction to the London Stock Exchange by large clothes manufacturers and furniture firm such as MADE which is about to list its stock publicly on London Stock Exchange's main market, it is clear that the value is absolutely there - it's quite astonishing that these firms are achieving projected post-IPO valuations into the billions, but also that London Stock Exchange is the listing venue of choice.

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