08 September 2021

Purmo Group Ltd (“Purmo Group”) and Virala Acquisition Company Plc. (“VAC”) have today agreed to combine Purmo Group with VAC and to list the new combined company on the official list of Nasdaq Helsinki upon completion of the merger. 

Upon completion of the merger, Purmo Group’s current shareholders including Rettig Group and management investors, will receive an ownership share of 73.3% of the class C shares in the combined company, whereas VAC shareholders, including Virala Corporation, will receive an ownership share of 26.7% of the class C shares in the combined company. Subject to all conditions for completion being fulfilled, and to obtaining necessary regulatory approvals, the completion of the merger is expected to occur by the end of December 2021. Trading of the new shares in the combined company is expected to start on the Nasdaq Helsinki on or about the first trading day following completion of the merger or as soon as possible thereafter. Tomas von Rettig and Matts Rosenberg are proposed to hold the Chairman and Vice Chairman roles, respectively, in Purmo Group’s new Board of Directors.

Since Rettig Group acquired Purmo Tuote Oy in 1970, the company has grown from a small local business in Finland to an internationally leading company in sustainable indoor climate comfort solutions. Purmo Group has a unique market position offering both hydronic radiators and other heating and cooling products into integrated indoor climate comfort solutions. In Europe, Purmo Group is the clear market leader in radiators and a top company and key challenger in the market for radiant heating and cooling. In 2020, Purmo Group generated a turnover and adjusted EBITDA of EUR 671 million and EUR 85 million, respectively.

Purmo Group is well positioned to benefit from sustainability trends, both in Europe and globally, as c. 40 per cent of EU’s CO2 emissions come from buildings as of today. Demand for sustainable solutions is supported by a regulatory push towards energy efficiency and recyclability, as well as c. EUR 250 billion of additional funding per annum over the next 7 years, related to the EU Green deal. To enable better energy-efficiency and achieve the goal of reducing buildings’ greenhouse gas emissions, digital and integrated solutions are becoming increasingly important and are expected to underpin future growth. These factors benefit Purmo Group as a provider of solutionsenabling unified HVAC (heating, ventilation, and air conditioning) systems for improved indoor climate, increased energy efficiency, Smart Home integration, greater system control and simple automation. An expected positive construction growth outlook and European residential construction spending are also supporting the overall underlying market.

“Rettig Group’s mission is to create value for generations and our strategic objective is to own and develop best-in-class companies together with partners who share our vision and ambition. The contemplated listing of Purmo Group through a merger with VAC is perfectly aligned with our strategy, and will support Purmo Group’s growth strategy and value creation agenda. Purmo Group will continue to have a committed owner base and an experienced management team with a strong track record of delivering profitable growth. We are very proud of Purmo Group’s over 50-year long journey as a part of Rettig Group. As a majority owner of Purmo Group also subsequent to the contemplated listing, we are fully supportive of the company’s growth and value creation strategy and committed to its new journey as a listed company”, said Tomas von Rettig, Chairman of Rettig Group, and Chairman of Purmo Group.

“Today’s announcement is an important milestone in the transformation of Rettig Group and our largest portfolio company Purmo Group. We have worked closely with Purmo Group’s management team and Board of Directors over the recent years in creating a strong and cost-competitive company positioned for growth, with a clear strategic roadmap. The contemplated stock exchange listing will support Purmo Group in realising its full potential in many important ways, e.g. by enabling the company to accelerate its M&A agenda”, said Matts Rosenberg, CEO of Rettig Group, and Board member of Purmo Group.

“In the midst of a globally urgent need for sustainable solutions to solve the climate challenge, Purmo Group is uniquely positioned as a leading provider of indoor climate solutions in Europe and globally. Our solutions provide not only indoor climate comfort in residential, commercial, and public buildings, but also a solution to the climate challenge through improved energy efficiency of those buildings. We have a clear and well-defined growth strategy supported by longstanding relationships with wholesalers and installers across Europe, Russia and China, a brand portfolio recognized for quality and innovation, a broad product offering and committed employees. Together with my management team, I am very excited to lead Purmo Group to become a publicly listed company with a clear ambition to become global market leader in indoor climate comfort solutions ”, said John Peter Leesi, CEO of Purmo Group.

According to the preliminary timetable VAC will publish a prospectus with detailed information on the merger in November 2021. VAC expects to convene the EGM resolving on the merger to be held on or about 13 December 2021. Subject to all conditions for completion being fulfilled, the completion of the merger is expected to occur by the end of December 2021. The new shares are expected to start trading on the Nasdaq Helsinki on or about the first trading day following completion of the merger or as soon as possible thereafter. 

The name of the combined company will be Purmo Group Plc and it will be headquartered in Helsinki, Finland. 

Subject to approval by the EGM of VAC, the Board of Directors of the new combined company will comprise at least seven members in total, including Tomas von Rettig and Matts Rosenberg from the current Board of Directors of Purmo Group, and Alexander Ehrnrooth from the current Board of Directors of VAC. It is intended that Tomas von Rettig and Matts Rosenberg will hold the Chairman and Vice Chairman roles, respectively, in Purmo Group’s new Board of Directors.

Rettig Group will assess, between signing and closing of the contemplated transaction, the merits of a bond buyback offer and a likely bond consent solicitation process in connection with Purmo Group’s financing. In line with earlier market communication, Rettig Group is in the process of repaying all outstanding bilateral loans totalling EUR 140 million. In addition, existing committed revolving credit facilities have been cancelled.  Rettig Group Commercial Paper Programme remains in place. Subject to the terms and conditions of the programme, Rettig Group will repay maturing commercial paper according to existing maturity date profile.

Advium Corporate Finance and UBS Investment Bank acted as financial advisors to Rettig Group. Avance Attorneys acted as legal advisor to Rettig Group. Bravura acted as communications advisor to Rettig Group and Purmo Group. 

More detailed information about the contemplated merger and listing of Purmo Group is available on the transaction page of VAC:

Rettig Group is a leading Finnish family-owned investment company that creates value for generations through active and responsible ownership. Rettig Group’s core investments are eQ, Purmo Group, SigmaRoc, and Terveystalo. Rettig Group is also increasingly active in financial investments, including private equity fund- and co-investments.

Purmo Group is an internationally leading company in sustainable indoor climate comfort solutions. Purmo Group’s comprehensive product offering includes radiators, towel warmers, underfloor heating, convectors, valves and controls. The company’s 3,300 industry professionals operate through more than 34 locations in 19 countries, manufacturing and distributing top quality products and solutions to customers in more than 100 countries globally. 

Virala Acquisition Company Plc (VAC) is a Finnish acquisition company, tailored to the Finnish capital markets. The goal of VAC is to identify and execute one or more acquisitions that aim to create significant value for both the shareholders and the target company, as well as complement the Finnish capital markets. . VAC seeks one or more companies and/or businesses with an estimated enterprise value ranging from approximately EUR 50 to EUR 500 million. The founding shareholder of VAC is the industrial enterprise Virala which has committed to act as a long-term anchor owner and developer of the companies to be acquired.

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