Smurfit Kappa to enter higher growth Central American market through CYBSA acquisition
Smurfit Kappa Group is pleased to announce that it has agreed to acquire Grupo CYBSA, a non-integrated corrugated, folding cartons and flexible packaging manufacturer with operations in El Salvador and Costa Rica.
CYBSA is a private company with approximately 1,000 employees and net assets at 31 December 2014 of approximately US$40 million. It operates five packaging plants located in the higher growth markets of El Salvador and Costa Rica, from which it services a growing customer base in its domestic markets, along with Guatemala and Honduras.
Following the completion of over €160 million of acquisitions in the Americas in 2014, the acquisition of CYBSA will further enhance SKG’s presence in the region, providing us with an unrivalled packaging footprint across 12 countries from the southern United States to Argentina. Within these markets, the Group is uniquely placed as the largest pan-regional supplier to apply its increasingly global perspective and differentiated offering to create and drive value for our customers.
The transaction, which will be immediately earnings accretive, is expected to close in the second quarter of 2015 subject to customary closing conditions and regulatory approval. Based on 2014 EBITDA of almost US$13 million and expected synergies of approximately US$6 million, of which over US$4 million will be delivered in year one, the Group will complete the acquisition at a post synergies multiple of 5.5 times EBITDA.
Gary McGann, Smurfit Kappa Group CEO, said: “We are very pleased to announce our agreement to acquire CYBSA and look forward to welcoming the excellent team from CYBSA into the Smurfit Kappa Group. The transaction reflects our continued commitment to increase our market presence in the Americas and will further enhance SKG’s capacity to provide innovative, insight-led, differentiated and value enhancing packaging solutions to both current and prospective customers throughout the Americas.”