Mondi Group, South Africa, has signed an agreement to acquire 100% of the outstanding shares in Powerflute Group Holdings (U.K.), a division of Nordic Packaging and Container Holdings (Finland), for a total consideration of EUR 365 million on an enterprise value basis.

Powerflute operates an integrated pulp and paper mill in Kuopio (Finland) with an annual production capacity of 285,000 metric tons of semi-chemical fluting. Powerflute’s premium semi-chemical fluting is sold to a diverse range of customers, primarily for packaging fresh fruit and vegetables, but also other end-uses such as electronics, chemicals, and pharmaceuticals. Around half of the company’s production is sold in Europe, while the remainder is exported globally.

For the year ended Dec. 31, 2017, the company expects to generate revenues of around EUR 183 million and unaudited pro-forma adjusted EBITDA of around EUR 42 million. Powerflute will be integrated into Mondi’s Packaging Paper Business Unit.

Commenting on the acquisition, Peter Oswald, chief executive of Mondi Group, said that "the acquisition of Powerflute supports our strategy of investing in high-quality packaging and paper assets. We are excited by this opportunity to expand our customer offering by further broadening our containerboard product range and geographic reach."

The transaction remains subject to competition clearance and customary closing conditions and is expected to complete in the first half of 2018.

 

Mondi is an international packaging and paper Group, employing some 25,000 people across more than 30 countries. Its key operations are located in central Europe, Russia, North America, and South Africa. In 2016, Mondi had revenues of EUR 6.7 billion and a return on capital employed of 20.3%.