Acquisition of Rapak Acquisition of Rapak - US Based Bag-in-Box Packaging Supplier
David S. Smith (Holdings) PLC (the "Group") has today entered into an agreement to purchase the entire membership interests of Packaging Systems, L.L.C., which trades as Rapak, for US$ 25 million debt free, of which US$ 8 million is deferred for three years. A further earnout payment, based on the first three years' profits, of up to a maximum of US$ 18 million may become payable after three years. Rapak is a leading supplier of bag-in-box liquid packaging with manufacturing facilities in Chicago, Illinois and Union City, California. As at 31 December 1999 the business had debt free assets of US$ 10.8 million and in 1999 recorded earnings before tax and interest of US$ 1.2 million. Rapak will complement the Group's European bag-in-box liquid packaging operations by providing wider market coverage, significant proprietary technology and purchasing and other synergies. It will also fit well with the Group's other US plastics packaging business, Formative Engineering. |
