Macfarlane 09.07.24

Macfarlane Group has announced the acquisition of Polyformes for up to a maximum cash consideration of £11.5 million, including an earn-out of up to £4.8 million over two years, aiming to build the Group’s protective packaging business.

Macfarlane states that a further adjustment is due for net assets in excess of £1.6 million, with the expected net assets on completion being £1.8 million, including £0.7 million of net cash. Apparently, the consideration is being financed entirely from Macfarlane’s existing bank facility, and the Group states it operates within its bank facilities of £35 million and related covenants, which are committed until December 2025. 

Polyformes is a designer and converter of foam, mainly for specialist protective packaging applications, supplying customers in the aerospace, medical, defence and industrial sectors throughout the UK. For the year ended 31 December 2023, the company says it generated sales of £9.3 million, with EBITDA of £1.5 million and pre-tax profits of £1.4 million. 

Peter Atkinson, chief executive of Macfarlane, said: 

“Polyformes is a profitable, growing, well invested company with an experienced management team that is fully committed to the business. We look forward to working with the team at Polyformes to support its continued growth and develop opportunities for us to work together to provide our customers with a broader portfolio of protective packaging solutions.” 

In similar news, Sonoco, the company behind the Pringles can, recently announced it was purchasing Eviosys from KPS Capital Partners for $3.9 billion; the move is expected to make Sonoco the ‘leading’ metal food can and aerosol packaging manufacturer worldwide. It is set to generate a windfall of $1.8 billion dollars for KPS and its investors.

In the same month, Suzano revealed it had backed out of plans to acquire International Paper, with Reuters explaining that the latter ‘did not engage’ with an offer of over $15 billion – meaning its deal to acquire DS Smith could go ahead as planned. At the start of this year, Mondi expressed its interest in acquiring DS Smith in a merger expected to exceed €11.5 billion in value and create an ‘industry leader’ for paper packaging solutions in Europe.

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