Smurfit Kappa shares rally with acquisition of Raparenco

Packaging company Smurfit Kappa Group plc (LON:SKG) has seen a positive start to July trading, as its €460 million acquisition of Dutch paper and recycling firm Raparenco prompted its share price to rise.

The transaction is designed to be earnings accretive, with the addition of Raparenco expected to lead to savings of over €30 million.

“Raparenco’s strong strategic fit with Smurfit Kappa’s existing European businesses is expected to deliver synergies of in excess of €30 million”, said Smurfit Kappa chief executive, Saverio Mayer.

“Reparenco represents early delivery of a central element of our medium term plan – to increase our European recycled containerboard capacity. It is ideally situated in our core European operating region where we continue to see strong demand driven by growth in e-commerce and increased substitution of plastic with paper-based packaging”.

Including an Ebitda of €72 million, Raparenco’s Ebitda and synergies equate to a transaction multiple of less than 4.5.

Since markets opened, Smurfit’s share price has rallied over 1 percent, or 44p. Analysts from Jefferies International have reiterated their ‘buy’ stance on Smurfit Kappa stock.


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Senior Journalist at the UK Investor Magazine. Also a contributing writer at the Investment Observer, UK Property Journal and UK Startup Magazine. Postgraduate of King's College London with a specialisation in Business Ethics. Interested in Development Economics and David Hume.