- Intertape Polymer Group (ITP) has signed a definitive agreement to acquire Nuevopak, a void-fill and protective packaging solutions provider
- Intertape will pay US$43.8 million over a three-year period
- The company expects the acquisition to strengthen its product bundle and vertically integrate its paper converting operation
- Intertape Polymer Group develops, manufactures and sells a variety of paper, tapes, films, protective packaging and packaging machinery
- Intertape Polymer Group (ITP) is up by 2.6 per cent and is currently trading at $28.40 per share
Intertape Polymer Group (ITP) has signed a definitive agreement to acquire Nuevopak, a void-fill and protective packaging solutions provider.
Nuevopak, a private company headquartered in Hong Kong with subsidiaries in China and Germany, provides protective packaging solutions to customers around the world.
Intertape expects the acquisition to enhance its protective packaging business, strengthen its product bundle, secure dispensing machine supply and vertically integrate its paper converting operation.
Nuevopak currently supplies Intertape with paper dispensing machines and converted paper for protective packaging distribution in North America.
The acquisition is expected to close in Q3 2021.
Financial highlights
Intertape will pay US$43.8 million consisting of US$34.8 million at closing and the remaining amount within three years from closing.
The company anticipates a 5x post-synergy adjusted EBITDA acquisition multiple by 2023.
Expected cost synergies include margin expansion and savings on future capital expenditures by leveraging Nuevopak’s parts sourcing and assembly capabilities.
The company estimates deal and integration costs to be approximately US$2-3 million. It plans to finance the acquisition with funds from its US$600 million credit facility.
Greg Yull, President and CEO of Intertape, commented,
“Protective packaging, and our ability to offer a comprehensive solution, including consumable products, dispensing machines and field support services, continues to be a strategic portion of our product bundle. Nuevopak has been a valued partner of ours for several years and this acquisition was a natural evolution of that relationship.
The acquisition represents a near-term opportunity that increases our ability to service the e-commerce vertical which is expected to see strong growth for the foreseeable future.”
Intertape Polymer Group develops, manufactures and sells a variety of paper, tapes, films, protective packaging and packaging machinery.
Intertape Polymer Group (ITP) is up by 2.6 per cent and is currently trading at $28.40 per share as of 12:38 pm ET.