REG-Smurfit Kappa Group PLC Acquisition

Smurfit KappaAnnouncement

31/10/2018 07:00

      Acquisition
    

    

      Smurfit Kappa to expand its Southeast European footprint with the 
      acquisition of the largest integrated packaging business in Serbia
    

      SKG.ID SKG.LN
    

      Smurfit Kappa Group plc ('SKG' or the 'Group'), one of the world's 
      largest manufacturers of paper-based packaging products, with operations 
      in Europe and the Americas, is pleased to announce that it has agreed to 
      acquire Fabrika Hartije d.o.o. Beograd (‘FHB’) paper mill and Avala Ada 
      d.o.o. Beograd (‘Avala Ada’) corrugated plant, in Belgrade, for a 
      consideration of €133 million (the ‘Transaction’) from Kappa Star Group.
    

      The acquisition will expand SKG’s geographic footprint and provide for 
      full containerboard integration in the Group's packaging operations in 
      Southeast Europe. FHB and Avala Ada are well invested businesses, with a 
      leading market position in Serbia and solid positions in adjacent 
      countries.
    

      The containerboard mill holds one recently upgraded recycled 
      containerboard machine with a current capacity of 120,000 tonnes and 
      significant potential to drive synergies and further increase capacity 
      with a limited investment of capital. The corrugated plant has a current 
      production of approximately 110 million square metres and produces both 
      corrugated and laminated packaging. Its customer base is predominantly 
      composed of local and national customers, providing a strong platform 
      for organic growth with SKG's Pan European and Multi National customers 
      in the region.
    

      The transaction reflects a pre-synergy multiple of 7.6 times the 
      expected full year 2018 EBITDA and the consideration will be funded from 
      the Group's existing resources. It is expected that the Transaction will 
      complete by year end subject to customary completion conditions.
    

      Transaction Highlights
    

      

        Acquisition of packaging business provides opportunity to further 
        expand SKG's Pan European footprint while entering a new, well 
        consolidated and growing market.
      
      

        Acquisition of high quality containerboard mill with a current 
        capacity of 120,000 tonnes securing paper integration in the region 
        with significant production expansion potential.
      
      

        Completed at pre-synergy multiple of 7.6 times the expected full year 
        2018 EBITDA.
      
    

      Smurfit Kappa Group CEO, Tony Smurfit, commented: “We are 
      pleased to announce our agreement to acquire FHB and Avala Ada, which 
      will be a cornerstone to the expansion of our business in Southeast 
      Europe. We look forward to welcoming their experienced teams into the 
      Smurfit Kappa Group, and we are confident their expertise and the high 
      quality of the companies' asset bases will provide us with an excellent 
      platform to grow in the region and further strengthen our European 
      offering for our new and existing customers.
    

      ENDS
    

      

        

          Contact
        
      
      

        

          

            Garrett Quinn
          
        
        

           
        
        

           
        
        

           
        
        

          

            FTI Consulting
          
        
      
      

        

          Smurfit Kappa Group
        
        

        
        

        
        

        
        

        
      
      

        

        
        

        
        

        
        

        
        

           
        
      
      

        

          T: +353 1 202 7180
        
        

        
        

        
        

        
        

          T: +353 1 765 0800
        
      
      

        

          

            E: ir@smurfitkappa.com
          
        
        

        
        

        
        

        
        

          

            E: smurfitkappa@fticonsulting.com
          
        
      
    

      About Smurfit Kappa
    

      Smurfit Kappa, a FTSE 100 company, is one of the leading providers of 
      paper-based packaging solutions in the world, with around 45,000 
      employees in approximately 350 production sites across 33 countries and 
      with revenue of €8.6 billion in 2017. We are located in 21 countries in 
      Europe, and 12 in the Americas. We are the only large-scale pan-regional 
      player in Latin America.
    

      With our proactive team we relentlessly use our extensive experience and 
      expertise, supported by our scale, to open up opportunities for our 
      customers. We collaborate with forward-thinking customers by sharing 
      superior product knowledge, market understanding and insights in 
      packaging trends to ensure business success in their markets. We have an 
      unrivalled portfolio of paper-packaging solutions, which is constantly 
      updated with our market-leading innovations. This is enhanced through 
      the benefits of our integration, with optimal paper design, logistics, 
      timeliness of service, and our packaging plants sourcing most of their 
      raw materials from our own paper mills.
    

      Our products, which are 100% renewable and produced sustainably, improve 
      the environmental footprint of our customers.
    

      Follow us on Twitter at @smurfitkappa 
      and on LinkedIn at ‘Smurfit 
      Kappa’.
    

      www.smurfitkappa.com
    

    

    
View source version on businesswire.com: https://www.businesswire.com/news/home/20181031005281/en/

      Smurfit Kappa Group PLC