LONDON, UK: Macfarlane Group PLC announced the acquisition of Polyformes Limited for up to a maximum cash consideration of £11.5 million, including an earn-out of up to £4.8 million over two years. 

This earnings-enhancing acquisition demonstrates further progress in our strategy to build the Group’s protective packaging business through a combination of organic and acquisitive growth.

Founded in 1977, Polyformes designs and converts foam primarily for specialist protective packaging applications supplying to customers in the aerospace, medical, defence and industrial sectors, throughout the UK.

Polyformes is based in Leighton Buzzard and has an experienced team of 60 employees, including its three directors who will all remain with the Group following the acquisition.

There are significant opportunities for both Polyformes and Macfarlane to benefit from access to their respective industry expertise, ranges of bespoke protective packaging products and common supplier base.

For the year ended 31 December 2023, Polyformes generated sales of £9.3 million, with EBITDA of £1.5 million and pre-tax profits of £1.4 million.

This earnings accretive acquisition further demonstrates Macfarlane’s comprehensive ‘buy and build’ strategy in delivering further stakeholder value.

Macfarlane’s wholly owned subsidiary, Macfarlane Group UK Limited, has acquired 100% of Polyformes for a maximum cash consideration of £11.5 million (including an earn-out of up to £4.8 million based on agreed profit growth targets over two years).

A further adjustment is due for net assets in excess of £1.6 million with the expected net assets on completion being £1.8 million, including £0.7 million of net cash.

The consideration is being financed entirely from Macfarlane’s existing bank facility. The Group continues to operate well within its bank facilities of £35 million and related covenants, which are committed until December 2025.

Peter Atkinson, Chief Executive of Macfarlane, said: “Polyformes is a profitable, growing, well invested company with an experienced management team that is fully committed to the business. We look forward to working with the team at Polyformes to support its continued growth and develop opportunities for us to work together to provide our customers with a broader portfolio of protective packaging solutions.”