Containerboard

Irish paper-based packaging producer Smurfit Kappa Group (SKG) has agreed to acquire US-based non-integrated corrugated packaging manufacturer Bates Container, in a $150m deal.

The acquisition, which is subject to customary regulatory approval, will be completed in the fourth quarter of 2014.

Go deeper with GlobalData

Data Insights

The gold standard of business intelligence.

Find out more

Related Company Profiles

View all

Headquartered in Texas, Bates Container manufactures and supplies corrugated boxes and die-cuts in the US.

Around 135,000t of containerboard required by Bates will be supplied by Smurfit Kappa Orange County’s (SKOC) containerboard mill in Dallas.

Smurfit Kappa COO Tony Smurfit said: "This acquisition fits perfectly with our integrated model, complementing in a significant way the successful integration of SKOC, which was acquired in December 2012 and providing us with substantial scope for further synergies in both businesses.

"Importantly, the group’s enlarged packaging footprint in the US will further enhance SKG’s capacity to provide innovative, insight-led and value-enhancing packaging solutions to both current and prospective customers."

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.
"The acquisition, which is subject to customary regulatory approval, will be completed in the fourth quarter of 2014."

Smurfit Kappa CEO Gary McGann said: "The transaction reflects our continued focus on the accretive growth of our operations in the Americas and the combination of SKOC and Bates will increase our market presence and provide us with higher-quality earnings in this region."

The acquisition would be funded from Bates’ existing cash reserves, with the pro-forma 2014 EBITDA expected to be $18.5m.

The group has also identified synergies of $11.5m, which is expected to be delivered within 24 months of completion. Inclusive of synergies, the transaction will carry a pro-forma multiple of 5.25 times EBITDA.

Bates currently employs 320 people.

Image: Around 135,000t of containerboard required by Bates will be supplied by Smurfit Kappa. Photo: courtesy of Smurfit Kappa Group.