(Reuters) -Plumbing parts distributor Ferguson Plc said on Monday it has agreed to sell its UK-focused business to a private investment firm for about 308 million pounds ($421.65 million), allowing the group to focus solely on its main U.S. business.
The British company, which had been mulling to demerge Wolseley (LON:FERG) UK since 2019, said it is selling the business to Clayton, Dubilier & Rice and intends to pay a special dividend from the net proceeds of the sale.
The sale of the Wolseley brand was expected to fetch about 500 million pounds, according to a Bloomberg report in November.
The FTSE 100 company had said last year the timing of its demerger process was uncertain due to the COVID-19 pandemic and it was considering other options to exit the unit.
Wolseley sells plumbing, heating, cooling, drainage and mechanical supplies to tradespeople in the UK. The business accounted for nearly 9% of the group's revenue in the fiscal year ended July 2020.
"The transaction further simplifies the group and allows us to focus entirely on investing in and developing our business across North America where we have the greatest opportunities for profitable growth," CEO Kevin Murphy said.
Ferguson also said the deal, which is expected to close by the end of the month, would lead to the group retaining future responsibility for the UK pension obligations.
($1 = 0.7305 pounds)