Recticel announced that it has reached a final agreement with the Swiss listed company Conzzeta AG to acquire 100% of FoamPartner's equity in cash, with an enterprise value of 270 million Swiss francs, of which 20 million Swiss francs will be paid in January 2022. The purchase price of FoamPartner is 8.6 times its 2019-2020 pre-interest, tax and amortization profit. The transaction is subject to customary preconditions, including antitrust approval.
FoamPartner is a global supplier of high value-added technical foam solutions for the automotive, industrial specialty products, and life and care markets. FoamPartner and Recticel have significant complementarity and synergy.
The acquisition is expected to:
Accelerate the growth of high value-added services;
Enable Recticel to strengthen its business in Europe and global specialty foam solutions, especially in the fast-growing Asia Pacific and North American markets;
In the first year after the merger, increase the group's profit margin without accounting for synergies;
A synergy effect of 14 million euros will be achieved by 2023, and an operating rate of 10 million euros will be achieved by the end of 2021.
The FoamPartner business will merge with the Recticel flexible foam division to form a new engineering foam business division.
The financing was guaranteed by the syndicated acquisition financing arranged by KBC Bank, and the participation was confirmed by Belfius Bank and BNP Paribas Fortis Bank. The term of the acquisition loan is 3 years, and there are two 1-year extension options.
The transaction is expected to be completed in the first quarter of 2021.
Olivier Chapelle (CEO) said. "The acquisition of FoamPartner marks an important step in the adjustment of Recticel's strategic portfolio. Following the divestiture of Eurofoam in April, today's announcement proves our strategy of reallocating capital to higher growth and more profitable business opportunities. This transaction is a big deal for Recticel. It is a unique opportunity to expand its product range in technology and specialty foam solutions, and further expand our global presence in Asia and North America. We look forward to welcoming many new and highly skilled colleagues of FoamPartner Looking to the future, this acquisition will support our ambition to become a global engineered foam solutions provider and will create tremendous value for our customers, employees and all other stakeholders. In conjunction with today’s announcement, Recticel has launched a A strategic review to assess the future of Recticel`s bedding business segment, which will gradually become a group focused mainly on insulation and engineering foam."