Business Irish

Thursday 27 October 2016

Smurfit's McGann to remain as non-executive director

Published 03/06/2015 | 02:30

Gary McGann to leave in August
Gary McGann to leave in August

Gary McGann, who's resigning as chief executive of Smurfit Kappa in August, has agreed to remain on the packaging giant's board as a non-executive director.

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The company also said that it has appointed Gonzalo Restrepo as a non-executive director, with immediate effect.

Mr Restrepo (64) is a former chief executive of Latin America retail group Almacenes Exito. It's a subsidiary of France's Casino Group. He headed up the Latin American subsidiary from 1990 and retired from the role in 2013. He oversaw its growth from a business with just four stores in Colombia to a chain with over 500 outlets.

Mr McGann, who was recently named as the new chairman of gambling group Paddy Power, is being succeeded by Smurfit Kappa's chief operations officer Tony Smurfit.

Goldman Sachs initiated coverage of Smurfit Kappa last week with a buy rating. It put a 12-month €36 price target on the Irish company's shares, which yesterday were trading at €26.80.

Goldman Sachs analysts said they believe that European packaging consumption growth and increased pricing power can drive margin expansion.

It also said that Smurfit Kappa's exposure to emerging markets in Latin America is positive because margins in emerging markets are higher than those in developing markets.

"Acquisitions have been an important strategy for Smurfit Kappa, especially in the Americas region and given its track record of earnings-accretive deals, we see potential for inorganic growth in the Americas region through M&A," added the analysts. In March, Smurfit Kappa agreed to buy Grupo CYBSA, a packaging maker with operations in El Salvador and Costa Rica.

Irish Independent

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