Howden Joinery Group (LON:HWDN) said it has agreed to acquire the parent company of Ultima Furniture Systems Limited, which trades as DIY Kitchens, in a deal valuing the online kitchen retailer at an enterprise value of £390 million.
On a company call, Chief Executive Andrew Livingston said the acquisition gives Howdens access to “a distinct customer base” and a new route to market, separate from its existing trade-only model. DIY Kitchens sells kitchens exclusively online, principally to end users who want to manage the purchase and design process themselves.
Deal Terms and Financial Impact
Chief Financial Officer Jackie Callaway said the transaction values DIY Kitchens at about 8.5 times last-12-months EBITDA for the period ended March 31, 2026. The consideration comprises £292.5 million in cash and £97.5 million in new Howden Joinery Group shares issued to the vendors.
The deal is subject to customary regulatory approvals, with completion expected during the summer.
Callaway said DIY Kitchens generated £136 million of revenue in 2025 and has grown revenue by more than 17% annually over the past five years. The company reported 2025 EBIT of £37 million, representing a 27% EBIT margin. On a pro forma basis, DIY Kitchens would have represented about 5% of group sales in 2025.
Howdens expects the acquisition to be immediately accretive to revenue, operating margin and earnings per share, and to deliver returns on capital employed above its cost of capital from the outset, Callaway said.
Funding and Capital Allocation
The £292.5 million cash component will be funded through existing cash balances and a new £240 million bank facility. Callaway said the acquisition includes DIY Kitchens’ freehold property assets valued at approximately £55 million, and that the business has no leases.
Howdens expects to remain in a net cash position after the transaction. Callaway said the company’s capital allocation priorities remain unchanged, including investment in organic growth, a progressive dividend policy and the return of surplus cash to shareholders while maintaining a net cash position.
The transaction does not change the company’s dividend policy or affect its current £100 million share buyback program, which is scheduled to be completed in 2026. Callaway also said Howdens’ year-to-date trading remains in line with expectations and that the company remains on track with its 2026 outlook.
Standalone Online Model
Livingston emphasized that DIY Kitchens serves a different customer segment from Howdens. Howdens remains focused on trade customers through its depot network, design services, in-stock availability and credit terms. The company has more than 890 U.K. depots and expects that number to rise to 1,000 in the coming years.
By contrast, DIY Kitchens is an online-only business with made-to-order products and limited showroom infrastructure. It currently has two large destination showrooms near regional distribution facilities, with a third under construction in Livingston, Scotland. Livingston said the company sees opportunities for further U.K. coverage through destination showrooms with broadly two-hour catchment areas.
In response to analyst questions, Livingston said DIY Kitchens has around 1% to 2% market share and operates in a U.K. kitchen market Howdens estimates at about £6 billion, with roughly half of that market in retail. He said the initial focus for DIY Kitchens will remain on U.K. online kitchens rather than expanding into other categories or overseas markets.
Management and Integration
DIY Kitchens will be led by Julian Lee as managing director. Lee has led Howdens’ manufacturing and logistics operations for the past six years and will continue to report to Livingston. The founders of DIY Kitchens, Alf and Clare Ellis, will retire upon completion of the transaction, though Alf Ellis will continue to provide advice and support as needed.
Matt Ellis, who Livingston said was pivotal in the launch and success of the online business, will become DIY Digital Marketing Director and join the leadership team.
Livingston said Howdens plans to keep DIY Kitchens independent, comparing the approach to his previous experience at Screwfix, where he said operational independence was an important part of that business’s success. He said any cost savings would initially focus on areas such as raw materials, sourcing and machinery.
“We will run DIY Kitchens and Howdens as distinct and separate businesses so that each model can continue to focus on its well-defined customer base,” Livingston said.
Strategic Rationale
Howdens said both businesses are vertically integrated but operate differently. DIY Kitchens manufactures made-to-order products in shorter production runs, while Howdens predominantly manufactures to stock through longer production runs. Livingston said in-house manufactured products represent around 40% of DIY Kitchens’ cost of goods sold, comparable to Howdens’ level of manufacturing.
Livingston said the acquisition represents a “new leg of growth” for Howdens and described DIY Kitchens as a rare asset that is complementary to the group. He said the company remains focused on its core trade business, including depot expansion, refits and range development, while adding a separate online consumer-facing proposition.
About Howden Joinery Group (LON:HWDN)
Howden Joinery Group Plc is the parent company of Howdens.
Howdens sells kitchens and joinery products to trade customers, primarily small local builders, through a network of over 850 UK depots. The business also operates over 70 depots across France, the Republic of Ireland, and Belgium.
Howdens only sells to the trade – they have the expertise to ensure that our products are fitted to the highest possible standards. Local Howdens depots build trusted partnerships with trade professionals, helping them to exceed their customers’ expectations and allowing their businesses and ours to profit from doing so.
