Smurfit Kappa Group CEO Tony Smurfit
Paper mill and corrugated plant acquired for €133 million
Smurfit Kappa Group plc, one of the world’s largest manufacturers of paper-based packaging products, with operations in Europe and the Americas, announced that it has agreed to acquire Fabrika Hartije d.o.o. Beograd paper mill and Avala Ada d.o.o. Beograd corrugated plant, in Belgrade, for a consideration of €133 million. 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.
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.
The acquisition will expand SKG’s geographic footprint and provide for full containerboard integration in the Group’s packaging operations in Southeast Europe.
Smurfit Kappa trading update announced
Smurfit Kappa Group plc also announced a trading update for the 9 months ending 30 September 2018. The Group announced EBITDA growth of 27% year-on-year to €1,130 million, with strong growth continuing in Europe and the Americas. In addition, due to losing control over Smurfit Kappa Carton de Venezuela, the Group has deconsolidated Venezuelan operations resulting in a write down of net assets of €66 million.
