Thursday, September 15, 2022
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Stora Enso acquired Netherlands based De Jong Packaging Group, for an enterprise value of approximately EUR 1,020 million. This acquisition is expected to strengthen Stora Enso’s strategic positioning, speed up revenue growth, and increase market share in Europe for green packaging. One of the biggest corrugated packaging manufacturers in the Benelux nations is De Jong Packaging Group. Its geographic reach and product range will supplement and improve Stora Enso’s offerings, particularly in the areas of fresh produce, e-commerce, and industrial packaging.
A foundation for sustained expansion
By acquiring De Jong Packaging Group, Stora Enso will dramatically increase its market share in corrugated packaging across Europe and gain access to the Netherlands, Belgium, Germany, and the UK. With this acquisition, the Packaging Solutions business of Stora Enso will be able to accommodate De Jong Packaging Group’s ongoing expansion initiatives as well as an additional 1,200 million square metres of corrugated packaging. This will establish a foundation for sustained expansion in important markets. The market for corrugated packaging in Europe is fragmented, and local presence is essential for long-term development. Around EUR 1,020 million is the enterprise value of the transaction, of which EUR 250 million is made up of IFRS lease liabilities. Based on an adjusted EBITDA of EUR 114 million for 2022, the enterprise value is equivalent to an 8.9 multiple.
“In line with our strategy, we are investing in growing our market share in renewable and circular packaging solutions. De Jong Packaging has a solid presence in the corrugated packaging sector and an impressive customer base. Acquiring their operations supports our future strategic direction to advance renewable packaging solutions within Europe,” says Annica Bresky, President and CEO at Stora Enso. After three years, the takeover is anticipated to produce average annual synergies of 30 million euros across the cycle, primarily through procurement, containerboard integration optimization, and business prospects. Additional synergies will be available if Stora Enso decides to move through with the conversion of the Langerbrugge paper production site in Belgium to containerboard, which is now under study. If De Jong Packaging Group reaches specific revenue levels in 2024, Stora Enso may make a maximum further earn-out payment in cash of EUR 45 million.
Tags: Benelux, circular packaging, De Jong Packaging Group, renewable solutions, Stora Enso, woodworking and manufacturing, woodworking Europe, woodworking event, woodworking industry, woodworking news, woodworking UK
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