XMA just swallowed Sugar firm, now looks to eat consumables biz
2 deals in 1 month for Westcoast Holdings group looks likely
Less than a week after Westcoast Holdings-owned XMA swallowed Lord Sugar's public sector-focused tech biz Viglen, the group looks to have hoovered up consumables trader QC Supplies.
Word in the distie channel is that a deal has been finalised for QC, which wholesales and resells cartridges from its Halifax base, and filings at Companies House would seem to back this up.
A document posted by QC Supplies yesterday revealed that it had appointed Sunil Madhani, a director at Westcoast Holdings and numerous other firms in the group including XMA and Viglen, as a company director.
And in a separate filing on the same day, QC also confirmed that director Robert Clavering had resigned as company director and secretary.
Westcoast started life as a distributor in the early '80s but expanded organically and via acquisition to become a £1bn-plus group, buying up consumables distie Orion and reseller XMA along the way.
The plan is to take XMA/Viglen from a £200m biz to £300m "very quickly", Viglen customer services director Glyn Wragg told staff last week in an email that was seen by El Chan. The QC deal would help it get there.
It is not clear what Joe Hemani, boss of Westcoast Holdings, the ultimate parent company for the group, has paid for the latest buy, but QC's last results pointed to a more bumpy ride ahead for the firm.
Turnover in the year to 31 March 2013 fell to £44.7m from £57.7m in the previous fiscal year, a decline of 23 per cent. QC Supplies blamed a drop in internet sales and "sales to other internet traders".
"The directors expect a further period of consolidation in the immediate future," the director's report stated.
QC Supplies also reported a "further tightening of trade credit terms", and this caused net cash outflow of £500k, although the net position remained positive at £184k.
Falling sales hit the bottom line with QC recording an operating loss of £81k versus an operating profit of £169k in the previous year. Becoming part of a much larger group will help with economies of scale.
The Channel contacted Westcoast boss Hemani, who told us to "get the f*ck out of here" and we have emailed QC Supplies for comment, which was its preferred line of communication. We will update when/if a response arrives. ®