Metcash (ASX:MTS) set to buy 70% stake in Total Tools

Company News

by Katrina Bullock

Wholesale distribution and marketing company, Metcash (ASX:MTS) has penned a binding agreement to acquire a 70 per cent interest in Total Tools Holdings for ~$57 million.

Total Tools is the franchisor to the largest commercial tool retail network in Australia with 81 bannered retail stores nationwide.

The retail store network generated sales of ~$555 million for the 12 months ended 31 December 2019.

Over time Metcash aims to have a mix of independently owned and joint venture retail stores within the network and will provide Total Tools with a $35 million debt facility to support its growth plans and the future acquisition of an ownership interest in a select number of stores.

The acquisition is subject to approval by the Australian Competition and Consumer Commission and if approved, the acquisition structure includes a clear pathway for Metcash to acquire the remaining 30 per cent stake in Total Tools within the next 4 years by way of put and call arrangements.

Shares in Metcash (ASX:MTS) are trading 0.36 per cent higher at $2.76.

 

Katrina Bullock

Finance News Network
Katrina is a respected TV journalist, as well as a renowned presenter and award winning lawyer. She holds a Bachelor of Laws (Honours 1st class, division 1), a Bachelor of Business (with Distinction) and is currently undertaking a PhD in Law focused on stock exchange disclosures and corporate governance. She began her career as a corporate lawyer in an Australian top tier commercial law firm and is currently the General Counsel of Greenpeace Australia Pacific. In 2020 Katrina was named one of the 30 best lawyers in Australia under 30 by Lawyer's Weekly.