Essentra finds route into Mexico in Micro Plastics acquisition
Essentra has acquired 100% of the share capital of Micro Plastics for an undisclosed cash consideration, it announced on Wednesday morning.
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The FTSE 250 company said Micro Plastics, based in the US state of Arkansas, is a “leading” manufacturer and distributor of nylon fasteners and other plastic components for a wide range of industrial end-markets - including general industrial, automotives and white goods - and would be reported under its components division.
It said the acquisition of Micro Plastics would expand the division's product range and adds manufacturing capacity in the US, as well as provide an entry platform into the attractive Mexican market with a facility in Monterrey.
For the year to 30 June 2017, Micro Plastics generated revenue of $26.8m and adjusted earnings before interest and taxation $1.7m.
Micro Plastics was being acquired on a cash-free, debt-free basis, funded from existing facilities, with the transaction expected to be immediately earnings enhancing to Essentra.
“The acquisition of Micro Plastics is consistent with our strategic objective in components of identifying value-adding acquisition growth opportunities to consolidate our position as an expert manufacturer and distributor of a wide range of low cost components,” said Essentra chief executive Paul Forman.
“As a leading provider of fasteners, Micro Plastics significantly enhances our offering in the US for one of our core product ranges and adds custom injection moulding capability, as well as providing compelling cross-selling potential.
“In addition, through the site in Monterrey, we will extend our manufacturing footprint and gain access to a number of high-growth end-markets - such as white goods and automotives - in Mexico.”