Mayr-Melnhof Group has agreed to acquire Kotkamills Group Oyj from its shareholders for an enterprise value of around Euro 425 million, representing ca. 7.8x LTM EBITDA. The addition of Kotkamills will grow MMK’s position in the attractive virgin fiber based cartonboard (FBB) and Food Service Board (FSB) market, complementing its established position in recycled fiber based board. The proposed transaction will be immediately accretive to earnings.
Kotkamills operates two board / paper machines at its integrated mill in Kotka (Southern-Finland): a FBB/FSB board machine which started up in 2016 following an investment of more than Euro 180 million with current sales volumes of around 260 kt and a planned capacity of 400 kt; a saturated kraft paper machine with 170kt capacity in which the company is a leading global supplier. Kotkamills employs about 500 people and generates an LTM EBITDA of ca. Euro 55 million on sales of ca. Euro 380 million.
The cash payment will be funded from committed credit lines. The transaction is subject to customary completion conditions and regulatory approval. Closing of the transaction is expected by mid of 2021.
Mayr-Melnhof Group CEO, Peter Oswald, comments: “The acquisition of Kotkamills is an ideal complement to our existing cartonboard business. It strengthens MM’s business model as a dedicated cartonboard and folding carton producer with a reinforced position in virgin fiber based cartonboard which has good growth potential. Kotkamills adds significantly to MM’s sustainability strategy offering innovative solutions for plastic replacement. We have great confidence in the top-class team of Kotkamills to shape a promising future together.”
The Mayr-Melnhof Group is the world-leader in coated recycled cartonboard with a growing position in virgin fiber based board and Europe’s leading manufacturer of folding cartons.
