Smurfit Kappa has acquired two Brazilian integrated paper-based packaging companies, Indústria de Embalagens Santana (INPA) and Paema Embalagens, for a total consideration of R$805 million, or approximately €186 million.
The combined operations of both INPA and Paema include three recycled container-board mills with a total capacity of 210,000 tonnes, as well as four corrugated facilities servicing the north-east of Brazil, through the Rio and São Paulo regions, and the south of the country.
The net assets of INPA at 30 September 2015 stood at €30 million (R$129 million), while Paema’s amounted to €6 million (R$26 million).
The two businesses combined employ more than 1,700 people, and the group currently expects to generate synergies of €6 million (R$28 million) by the end of 2017, mostly through operational improvements and supply-chain optimisation.
Tony Smurfit, Smurfit Kappa Group CEO, commented, “We are pleased to announce the acquisition of INPA and Paema, which will extend our reach into a strategically important market and build on our geographic diversity and strength.
“We look forward to welcoming the experienced teams into the Smurfit Kappa Group. We are confident that their expertise and the high quality of their asset base will provide us with a strong entry point into the Brazilian market.”
The transaction was completed at the end of December, and will be immediately earnings accretive. It was funded by Smurfit Kappa’s existing liquidity, comprised mainly of cash resources with existing, committed credit facilities.
© 2016 European Supermarket Magazine – your source for the latest retail news. Article by Jenny Whelan. To subscribe to ESM: The European Supermarket Magazine, click here.