Polypipe ready for £400m market flotation

From left, Paul Rice, Polypipe business development director, Peter Shepherd, chief financial officer, and David Hall, chief executive. Picture: polypipe

Doncaster-based Polypipe’s return to the stock market after a 15-year absence will be the latest in a series of Yorkshire IPOs that marks a return to confidence in the region.

It also shows Yorkshire leading the way in manufacturing. While there has been a flurry of firms announcing plans to float on the stock exchange, Polypipe is only the second manufacturer.

The first was environmentally friendly washing machine company Rotherham-based Xeros, which will float on AIM in a £100m listing later this month. Xeros, a spin-out from Leeds University, hopes to raise up to £40m by selling a third of the company.

Analysts said that Yorkshire is spearheading the Government’s drive to expand the manufacturing sector and rebalance the economy.

Analyst Eric Burns at WH Ireland said: “It will be great to see a return to the stock market for Polypipe which is a long-standing name in Yorkshire manufacturing.

“This region has a great heritage as one of the leading manufacturing areas in the UK and the IPOs of both Polypipe and Xeros indicate investor interest is returning to this sector.”

Polypipe’s chief executive David Hall said: “The timing is right for us to float. The company is well-invested and is ready for the public market.

“We’ve done some market testing and the appeal is very strong. We think this will be good for the group’s public profile.”

Polypipe already has a strong brand following. The latest Superbrands survey revealed it was one of 11 Yorkshire institutions to make it into the top ranks of the UK’s most elite brands.

Polypipe will champion British manufacturing at a time when many companies have pulled out of the UK.

The group employs 1,100 people at its biggest site in Doncaster and another 800 at 15 other sites including Lincolnshire, Loughborough and Kent.

“Our aspirations don’t rely on the market picking up,” said Mr Hall. “There is a demand for more modern materials as new regulations have come into force in the UK.”

The group has seen strong demand for plastic pipes following regulations that favour plastic pipes over copper and concrete. Polypipe said its plastic pipes are thinner, lighter and stronger than clay or concrete and far less appealing to thieves than copper.

The firm has been successful in developing new markets for plastic piping systems including carbon efficient and water management solutions, giving it positive growth at a time when others have struggled.

It has also been boosted by a pick-up in the housing market and Government initiatives such as Help to Buy.

Mr Hall and his management team stand to make a considerable profit from the float.

They hold 15 to 20 per cent of the company and have committed to selling no more than 50 per cent of their stakes.