KapStone to acquire Victory Packaging in $515 million deal
In addition, two contingent earnouts totaling $45 million could be payable two and a half to four years after the close and are based on the continued strong growth of the business. Closing of the acquisition is subject to a number of customary conditions, including regulatory review.
The structure of the transaction will enable KapStone to realize a tax benefit that has an estimated net present value of approximately $100 million. Taking this benefit into account, the net purchase is about $515 million.
Founded in 1976, Victory Packaging, headquartered in Houston, TX, is a large, national distributor of all types of packaging specializing in providing unique solutions for its clients. Through its 65 distribution centers located in the United States, Mexico and Canada, Victory services customers with complex needs that often are not attractive to other integrated box manufacturers.
Victory's net sales grew to $953 million and adjusted EBITDA reached $55 million for the year ended December 31, 2014, and the CAGR for both net sales and adjusted EBITDA was in excess of 14% for the past four years. ■