Not sure if it was clear enough above : I do not see the increase of their debt as a problem for 2 main reasons : - based on the expected free cash flow of the combined group, they should be able to pay back this debt in around 3 years, - they are in a steady business, so putting some financial leverage is not a problem.
In terms of business, this acquisition is also going to modify the group's profile. While they were historically mainly a contract manufacturer for the phama, cosmetic and healthcare sector, they are now mainly a packing business. Packing will represent around 100 m of revenue/year vs around 77 m for their manufacturing business. They are also expanding into a new vertical (food and beverage), as well as into new channels : supermarket and online retail platform.
PBP Price at posting:
$2.03 Sentiment: Buy Disclosure: Held
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