Kingspan buys 51pc stake in Brazilian company Isoeste
Cavan-based Kingspan, which produces high-performance insulation and building-envelope solutions, has announced that it has acquired 51pc of the Brazilian company Isoeste Construtivos Isotérmicos ('Isoeste').
Isoeste, an insulated panel manufacturer in Brazil, operates from four sites and has approximately 630 employees. The company has forecast sales for 2017 of circa R$500m (€134m).
Assuming an earnings before interest and tax margin (EBIT) of 10pc, analysts at Investec estimate that the deal will add around 3pc to the 2018 EBIT at Kingspan and around 1pc to the company's earnings per share.
Commenting on the announcement, Gene Murtagh, CEO of Kingspan, said that the company was delighted to create the partnership with the founders of Isoeste, the number-one player in Brazil's insulated-panels market.
"Together with our recent investments in Colombia and Mexico, this acquisition firmly places Kingspan in a market-leading position across Latin America, with a strong platform for further expansion in the region," Mr Murtagh said.
Shares in Kingspan rose almost 3pc to €34.6050 on the Irish Stock Exchange yesterday.
In its half-year results, released last month, Kingspan announced that operating profit at the company had increased 6pc to €177.8m year on year in the six months to June 30.
The results were driven by acquisitions, which contributed 10pc to sales growth during the period, and insulated panel sales growth, which increased 17pc year on year.