Blackburn-based toilet roll and tissue maker Accrol Group said it has agreed a deal to be acquired by Portugal-based Navigator Paper for £127.5 million in cash.
The 38p per share offer represents a premium of 11.8% to the Accrol closing price of 34p on March 21, 2024.
Accrol shares rose as much as 12% to around the offer price of 38p.
Navigator is a large Portuguese integrated pulp, paper, tissue, packaging and biomass-based energy company, listed on the Euronext Lisbon Stock Exchange with a market capitalisation of about €2.7 billion.
In the financial year ended December 31, 2023, Navigator reported consolidated revenues of €1.953 billion and consolidated EBITDA of €502 million.
Navigator CEO António Redondo said: “The prospective acquisition of Accrol, a renowned tissue manufacturer based in the UK, marks a pivotal moment for Navigator, as we expand our commercial footprint to the UK tissue market.
“The proposed acquisition is perfectly aligned with our long-term growth strategy for the tissue business and underscores our unwavering commitment to driving innovation, sustainable growth, and operational excellence at Navigator.
“Accrol brings an outstanding business franchise, including an exceptional customer base, highly skilled employees, and a solid track record of producing quality tissue products.
“We are excited to integrate Accrol assets, competences, and talented team into our organization, aiming at solidifying our position as a reference player in the UK tissue industry and establishing our presence in the UK market over the long term.”
Accrol CEO Gareth Jenkins said: “Accrol has undergone a period of significant transformation and growth over the last four years, investing in fully automating its tissue converting operations to enhance manufacturing capabilities.
“I am proud and grateful to the efforts and commitment of our people. We have grown to become a leading manufacturer of private label, own branded and licensed tissue products to the UK market and have developed broad retail relationships and a robust supply model that enables us to produce great quality and value products.
“Combining with the Navigator Group brings together a highly complementary product offering. It will enable Accrol to benefit from the capabilities, scale, network and resources of Navigator, building on the strategic progress we have made to date.”