Likewise Group, a UK floorcoverings distributor, has acquired a number of assets from Headlam, which is currently in administration. The acquisition, valued at £14.9m, is described as a significant step for the group, which states: “Following Headlam’s administration and the acquisition, the board believes Likewise is the largest floorcoverings distributor in the UK, with an enlarged brand portfolio, additional freehold capacity and a broader customer base.” The company further says the acquisition will support the group in achieving its goal of £300m in revenue in the medium term.
The deal effectively marks the end of any chance for Headlam to exit administration. In a recent regulatory news bulletin, Headlam stated that the administrators’ initial goals were to trade through while pursuing a Company Voluntary Arrangement and a broader restructuring of the company’s debt. “As that work has progressed, and despite also exploring a sale of the whole of the trading business in a single transaction, it has become clear that a sale of certain parts of the business and assets of the group represents the best and most deliverable outcome for creditors, and that the administration exit is no longer a tenable option for the company, acting by the joint administrators.”
At the centre of the acquisition is Headlam’s 90,000 sq ft. freehold distribution centre at Thatcham, which transfers to the group together with its operating assets and the inventory held on site. Alongside the property, Likewise has acquired the trade and assets of two specialist businesses: Crucial Trading, and Concept Floors as well as the principal intellectual property. 110 employees at Thatcham, Crucial Trading and Concept Floors are expected to transfer to the group.
Other than the inventory held at Thatcham, Likewise is not buying Headlam’s inventory outright. Instead, it will help the Joint Administrators sell the current inventory over a nine-month period through the Group’s sales and distribution network. Proceeds will be shared between the Group and the Joint Administrators. The Group will occupy Headlam’s Coleshill site under a nine-month exclusive licence to help facilitate the inventory agency agreement.
The acquired assets and inventory agency agreement are not expected to make a material contribution to Likewise’s profitability in the remainder of the current financial year ending 31 December 2026, however are expected to provide a positive contribution in the following financial year, FY27.
Tony Brewer, Chief Executive of Likewise Group, said: “The acquisition is a key milestone for the group as it now becomes the leading distributor of floor coverings in the UK. The acquisition of the Thatcham Distribution Centre adds significant capacity to the growing Likewise distribution network and the purchase of well-known brands together with the Crucial Trading and Concept Floors businesses are very welcome additions. We look forward to welcoming our new colleagues, and to working with the administrators to give continuity to customers and suppliers.”
Headlam subsidiary also enters administration
At the beginning of October, Headlam’s board of directors additionally confirmed that Interpath has appointed administrators for the company’s subsidiary Ceco (Flooring) Limited.
“Unfortunately, following a detailed review of the options available, including exploring the possibility of a sale of the business and its assets, it was deemed there were no other viable options other than to place the entity into administration.”
With the exception of Ceco (Flooring) Limited, the group’s other trading subsidiaries currently remain unaffected, including those businesses trading under the name of Domus and Melrose.
Understandably, given the current circumstances, Headlam has delayed the publication of its half year report.