Monday 19 November 2018

Smurfit Kappa completes acquisition of Dutch group Reparenco

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Ellie Donnelly

Ellie Donnelly

Packaging giant Smurfit Kappa has completed the acquisition of Reparenco, a Dutch paper and recycling company, for €460m.

The acquisition, which represents a transaction multiple of over six times Reparenco’s 2018 expected full year earnings before interest, taxation, depreciation, and amortisation (EBITDA) of €72m, was initially announced in May.

Smurfit Kappa last month raised the money to finance the acquisition through a senior bond issuance.

Announcing the completion of the acquisition, Smurfit said that Reparenco’s strong strategic fit with its existing European business is expected to deliver synergies of in excess of €30m for it.

As part of the deal 315 Reparenco employees will join Smurfit.

Commenting on the deal Saverio Mayer, chief executive of Smurfit Kappa Europe, said that it represents an early delivery of a central element to Smurfit’s medium term plan, "to increase our European recycled containerboard capacity".

"It is ideally situated in our core European operating region where we continue to see strong demand driven by growth in e-commerce and increased substitution of plastic with paper-based packaging."

The company went on to say that the acquisition will add 405,000 tonnes of recycled containerboard capacity to its system.

"We are also pleased to have acquired a high quality graphic paper machine very well positioned in its market," Laurent Sellier, Smurfit Kappa COO, Paper Europe, said.

"While the machine offers the potential for conversion to containerboard over the medium-term, our intention is to continue to produce graphic paper for our customers for the foreseeable future."

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