HLS Helesi

 

TIDMSTT TIDMHLS 
 
RNS Number : 2045I 
Straight PLC 
08 March 2010 
 

Date:                           8 March 2010 
On behalf of:               Straight plc ("Straight" or "the Group") 
For immediate release 
 
Straight plc 
* Acquisition of UK business and assets of Helesi plc 
* Strategic alliance 
 
Straight plc (AIM: STT), the environmental products and services group, is 
pleased to announce that it has acquired the business and certain assets 
relating to the UK manufacturing operations of Helesi plc (AIM: HLS), for a 
total consideration of GBP1.65m in cash. 
 
Straight has acquired assets, including moulds and presses, relating to the 
manufacture of Helesi's most popular wheeled refuse and recycling containers in 
the UK. Following the acquisition, manufacturing of these products will be 
carried out by one of Straight's established manufacturing partners. The Group 
will begin selling the products directly to its wide customer base and will 
assume Helesi's position supplying the UK and Irish markets, as well as taking 
over existing customer contracts and supply agreements. These products will be 
jointly branded 'Straight' and 'Helesi'. 
 
The consideration consists of an initial payment of GBP0.45m on exchange, a 
further GBP0.45m on completion and the balance paid in ten equal monthly 
instalments commencing on 30 April 2010. The initial payments will be part 
funded by a loan of GBP0.75m from Straight's lending bank, Lloyds TSB, with the 
remainder of the consideration being paid from the Group's existing cash 
resources. In addition to the cash consideration, Straight will pay Helesi an 
ongoing royalty for the use of its brand on jointly branded products. 
 
For the six months to 30 June 2009, Helesi plc's UK business generated revenues 
of approximately EUR4.4m and profit before finance charges of EUR0.3m. 
 
Despite holding a 10-15% share of the UK wheeled bin market, Straight has never 
had a proprietary wheeled bin. Straight believes that over time this move will 
enable it to generate margins on wheeled bins more in line with those which the 
Group generates on its core proprietary container range. The Group believes that 
the addition of this proprietary wheeled bin range will significantly strengthen 
its position in its core markets. 
 
As part of the agreement, Straight has entered into a strategic alliance with 
Helesi under which it will become the exclusive UK and Irish distributor and 
licensee for other Helesi products including plastic 4-wheeled bins. The Group 
will also have the right of first refusal to import and distribute any new 
products developed by Helesi. Both companies expect to work together on the 
development of new products - utilising Straight's innovative expertise and 
Helesi's technical know how. 
 
Welcoming the news, Jonathan Straight, Chief Executive of Straight plc, said: 
"We have been a distributor of Helesi products in the UK for a number of years 
and our customers have always been very satisfied with their high quality. We 
are delighted that we are now able to service these markets with a proprietary 
product, manufactured locally and in line with our proven model which prides 
itself on quality, innovation and market leadership." 
 
For further information, please contact 
 
+----------------------------------------+----------------------+ 
| Straight plc                           |                      | 
+----------------------------------------+----------------------+ 
| Jonathan Straight, Chief Executive     | 0113 245 2244        | 
+----------------------------------------+----------------------+ 
|                                        |                      | 
+----------------------------------------+----------------------+ 
| Panmure Gordon                         |                      | 
+----------------------------------------+----------------------+ 
| Andrew Godber                          | 0207 459 3600        | 
+----------------------------------------+----------------------+ 
|                                        |                      | 
+----------------------------------------+----------------------+ 
| Redleaf Communications                 |                      | 
+----------------------------------------+----------------------+ 
| Paul Dulieu / Kathryn Hurford          | 0207 566 6700        | 
+----------------------------------------+----------------------+ 
 
Notes to Editors 
 
·    Straight plc is the UK's leading supplier of specialist kerbside recycling 
containers as well as a key supplier of a broad range of waste and recycling 
container solutions. Founded in 1993 by the current Chief Executive, Jonathan 
Straight, the business has since supplied more than 12 million kerbside 
recycling boxes to local authorities across the UK, securing its position as the 
industry leader. 
·     In 2005, Straight acquired Blackwall Limited, the UK's largest supplier of 
home composters and water butts. Through the Blackwall brand, Straight has 
delivered more than 3.5 million compost bins and water butts. 
·    The business operates through two divisions. The core Trade Business 
supplying products in bulk to local authorities, utilities, the waste industry, 
retailers and other businesses and the Retail Business supplying a range of 
proprietary environmentally friendly consumer products directly to the public, 
often in partnership with a local authority or a utility. 
·    Straight operates a radical business model with all manufacture outsourced 
on an international basis. Most production is local to the end market keeping 
freight movements and associated emissions to a minimum. 
·    In February 2009, Straight added to its portfolio with the acquisition of 
Harcostar Garden Products, a long established premium brand consisting of water 
butts, compost bins, watering cans and accessories. This has gained new 
distribution channels for the business in the UK and in Europe. 
·    Straight plc has established diverse overseas sales channels and is now 
producing and selling water butts in Australia as well as strong initial sales 
in the United States and Canada. 
·    Further information about the company and its products can be found at: 
www.straight.co.uk 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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