PCA recently declared that it has the intention to buy gradually all of the assets of Columbus Container for $100m.
12 Oct 2016 – Daily Herald
Under the terms of the agreement, PCA will acquire a full-line corrugated products facility located in Columbus, Indiana, five warehousing facilities and other related operations located in Indiana and Illinois.
The transaction is structured as a purchase of assets resulting in a full step-up of the assets to fair market value.
Columbus Container is a full-service provider of corrugated packaging products utilizing state-of-the-art technologies and design centers to provide customers a solution for nearly any packaging need.
As a result of the acquisition, PCA’s containerboard integration level is expected to increase by over 30,000 tons and will allow for further optimization and enhancement of mill capacity.
The value of the increased containerboard integration, the expected synergies and the tax benefit of the step-up of assets, plus Columbus Container’s LTM EBITDA, results in a purchase price multiple of approximately 3.3 times EBITDA. The acquisition will be accretive to earnings immediately.
“Following our acquisition of Timbar, this acquisition will further enhance our operations both geographically and strategically through additional integration and optimization of our warehousing and logistics capabilities,” PCA Chairman and CEO Mark Kowlzan said,
Closing is expected in the fourth quarter of 2016. The company expects to finance the transaction with available cash on hand.