New Zealand-based building materials manufacturer and distributor Fletcher Building has announced that its Formica business will acquire metal and specialty laminates manufacturer and distributor, Homapal Plattenwerk for EUR$30 million (approximately A$37 million).
The transaction is scheduled to be completed on 2 April 2012. Formica has been a 50 per cent shareholder of the Germany-based company 1983 and currently procures and distributes approximately 40 per cent of Homapal output.
In a statement to the NZX, Fletcher Building said the acquisition will complement its position in the global surfacing industry and increase its presence in Germany, one of the worlds’ largest laminate, and a market where Homapal holds a strong position.
The acquisition will reportedly allow Homapal to pursue growth opportunities for metallic laminates in Asia where Formica holds established distribution network and customer base.
Homapal manufactures laminates of aluminum, brass, copper and other metal folio in various plain and design effects from its manufacturing facility located south of Hannover, Germany. The plant is said to employ 70 people.
The acquisition will see Homapal operate as a subsidiary of Formica. Homapal leadership team and business model will remain unchanged.
“Homapal is a successful company with an outstanding reputation as niche leader in the high-end metal and specialty laminate business,” said Formica chief executive Mark Adamson in the statement.
“We’ve been part of the Homapal business for decades. We understand its capabilities and market differentiating qualities, and we’re eager to welcome Homapal to Formica while expanding our laminates and panel division.”
The transactions represents a 7.9 x EVIT multiple on current earning before synergies.
Fletcher Building is also listed on the ASX.
Image: Formica