Cairngorm Capital further expands interest in building industry with third sector acquisition

Alex Bayliss

This is Cairngorm Capital’s third acquisition in the building merchants sector, following its purchase of Stamco last month and Parker Building Supplies in March 2018.

The move means Surrey-based Fairfalls joins Parkers and Stamco to create the largest independent builders’ merchant group in the South East of England.

The newly enlarged group has 24 branches serving Surrey, Sussex and Kent, over 500 employees and combined revenues of £120 million.

With minimal branch overlap and a highly complementary product range, the partnership will aim to offer the strategic opportunity for geographic expansion and advances Cairngorm Capital’s strategy to expand its business through a combination of acquisitions, new site development and organic growth.

Alex Bayliss, managing director at Cairngorm Capital, said: “We have been working to build a customer-focused business, with great products, outstanding customer service and a strong, expanding branch network. Like Parkers and Stamco, Fairalls is an excellent company with a strong brand in the independent builders’ merchants market and an outstanding reputation with its customers. Geographically this partnership is highly complementary, extending our presence across the South East of England to make our group, the largest independent builders’ merchant in the region. We are delighted to welcome Fairalls to the group.”

A family firm dating its origins back to 1900, Fairalls offers a mix of heavy and lightside building materials, from its four locations in Surrey and Kent – Gatwick, Sevenoaks and two branches in Godstone. Its Taylors Hill Branch in Godstone is one of the largest heavyside yards in the South East.

In 2018 the business, currently managed by Bob Fairall and his son Richard, achieved revenues of approximately £15m with 85 employees. Bob will remain with the business on an interim basis before entering retirement.

Richard will also remain with the business which will continue to trade under the Fairalls brand.

Robert Fairall, managing director of Fairalls said: “Having made the decision to retire, it seemed natural timing to find a partner who would ensure Fairalls fulfils its potential and I believe our partnership with Cairngorm Capital and the other group companies will achieve this. We have much in common with Parkers and Stamco in terms of heritage, outstanding product quality and a commitment to the highest standards of customer service, which makes this a very good fit. I am looking forward to facilitating a successful handover of the business to our new partners, who will be working closely with my son, Richard, to pursue new opportunities for innovation and growth, which will benefit our customers and employees, while retaining the company’s core values.”

Cairngorm Capital was advised on this transaction by PwC (financial and tax), Gowling WLG (legal), CIL (commercial), JLT (insurance) and Vail Williams (property).

MDW Capital provided financing advice.

Fairalls were advised by Rix & Kay (legal), Plummer Parsons (financial and tax) and EMC (corporate finance).