Macfarlane Group, a Scotland-headquartered company, has announced the acquisition of UK-based protective packaging manufacturer Polyformes.
The deal, valued at £11.5m ($14.73m), includes an earn-out of up to £4.8m based on agreed profit growth targets over the next two years.
The acquisition of Polyformes aligns with Macfarlane's strategic objective to enhance its protective packaging business through both organic growth and strategic acquisitions.
Polyformes, located in Leighton Buzzard, specialises in designing and converting foam for specialist protective packaging applications.
The company primarily serves various sectors, including aerospace, medical, defence, and industrial.
For the year ending 31 December 2023, Polyformes reported sales of £9.3m, earnings before interest, taxes, depreciation, and amortisation of £1.5m, and pretax profits of £1.4m.
All 60 employees from Polyformes, including three directors, will join Macfarlane post-acquisition.
The acquisition is expected to be earnings accretive and is a testament to Macfarlane's 'buy-and-build' strategy aimed at delivering increased value to stakeholders.
Macfarlane financed the acquisition through its existing bank facility.
The group maintains a strong financial position, operating well within its £35m bank facilities and related covenants, which are committed until December 2025.
Macfarlane CEO Peter Atkinson: "Polyformes is a profitable, growing, well-invested company with an experienced management team that is fully committed to the business.
“We look forward to working with the team at Polyformes to support its continued growth and develop opportunities for us to work together to provide our customers with a broader portfolio of protective packaging solutions."
Macfarlane employs more than 1,000 people across 40 sites, mainly in the UK, with additional locations in the Republic of Ireland, Germany, and the Netherlands.
The company serves over 20,000 customers, primarily in the UK and Europe.
In March this year, Macfarlane Group announced the acquisition of protective packaging distributor Allpack Packaging Supplies.
