ITALY (News release) -- Smurfit Kappa says it is buying Verzuolo, a containerboard business in northern Italy, for a cash consideration of €360 million. The Verzuolo mill owned by the Burgo Group, is situated close to the port of Savona in the northwest of Italy. The PM9 machine was newly constructed in 2002 and converted into a 600,000 tonne capacity recycled containerboard machine in 2019.

Verzuolo is highly complementary to SKG's existing business and is strategically positioned to serve both the Southern European region and other markets ensuring we continue to provide the best service to our corrugated customers. The acquisition will deliver significant synergistic benefits including technical and production optimisation, and increased containerboard integration within the Group.

The cash consideration will be funded from the Group's existing resources. It is expected that the acquisition will complete during the fourth quarter, subject to customary closing conditions including regulatory approval.

Transaction Highlights

• SKG has agreed to acquire a state of the art, strategically located recycled containerboard facility
• World-class recycled containerboard mill with 600,000 tonne capacity
• Provides additional security of supply for SKG's customer base
• Immediately earnings accretive
• Strengthens Smurfit Kappa's integrated operating model
• Optimally located for SKG's Southern European corrugated facilities

Smurfit Kappa Group CEO, Tony Smurfit, commented: 'We welcome the highly experienced Verzuolo team to the Smurfit Kappa Group as we continue to strengthen the world's leading paper-based packaging group. Consistent with our multi-stakeholder approach, we believe that this acquisition represents another positive step for the Group, our customers and all shareholders. SKG has a proven ability to identify, acquire, integrate and optimise complementary businesses. This acquisition also reflects the inherent agility of our approach to deploying capital rapidly and effectively.'

Smurfit Kappa Europe CEO, Saverio Mayer, concluded: 'SK Europe is delighted to announce our agreement to acquire Verzuolo. It is a business that we had identified and have admired for some time. The acquisition demonstrates our commitment to this important market for the Group and provides additional security of supply for our customer base. It strengthens the Group's unique integrated operating model and is highly complementary to the significant investments we are making in our corrugated facilities.'