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EUROPAC purchases an integrated packaging plant in Lucena

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The Europac Group (Papeles y Cartones de Europa S.A.) has purchased two companies that collectively own a comprehensive packaging plant in the town of Lucena, in Cordoba. The operation cost 9.8 million euros, company value, representing a post merger value of 5.5 times EBITDA for Europac.

· ​In 2016, the plant produced 16 million m2 of cardboard, turned over 7.6 million euros and generated an EBITDA of 1.2 million euros, representing a margin of 15.8%.

· The operation cost 9.8 million euros, company value, representing a post merger value of 5.5 times EBITDA for Europac

· Europac will gradually implement a ten-million euro investment plan to expand its facilities, increase production, purchase new assets and optimise current assets.

· With this purchase, Europac now has a presence in Andalusia, which is an attractive market with strategic sectors, such as agriculture and food

Up until now, shares in the business were distributed among ICOA (Industrias Cartones Ondulados Andaluces S.L.) and OASA (Ondulados Andaluces, S.A.), two companies dedicated to manufacturing corrugated cardboard and using cardboard for packaging.

The new facility, which will now be called Europac Packaging Lucena, turned over 7.6 million euros and generated an EBITDA of 1.2 million euros at the end of 2016, which represents an EBITDA margin of 15.8%. At the moment, the plant has one corrugator and three converters to turn cardboard into boxes, in a 15,000m2 warehouse, within a 42,000m2 plot of land. Last year it used 7,000 tonnes of paper and produced 16 million m2 of cardboard and packaging.

The Europac Group will carry out a ten-million euro investment plan with the aim of increasing production, purchasing new assets, optimising the current assets and expanding the installations. It is expected that during the investment period, 25 direct new jobs will be created.

Growing in the Spanish market

José Miguel Isidro, executive chairman of Europac, states that “the purchase of the Lucena plant is the result of our long-term project to expand in the packaging sector and fulfil the commercial strategy of the Packaging Division in Spain, where the company does not yet have the position it deserves”.

José Miguel Isidro also declared that “Europac Packaging Lucena is a very profitable factory with a huge potential for growth. Our goal is to establish it as a leader within the sector".

Luis Serrano, country manager of Packaging Division of Europac in Spain and manager of the new plant, stated that “our commercial objective is to strengthen the current position in the industrial sector and move into new markets, specifically those of agriculture and food, which are especially relevant strategic sectors in Andalusia and big consumers of packaging”.

The plant is strategically situated in the geographical centre of Andalusia, with a sphere of influence that covers target markets in Córdoba, Seville, Almería, Málaga, Jaén and Granada, all of which are at a distance of between 70 and 150 kilometres.

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