KPMG Deal Advisory acted as M&A advisor of ECO-INVESTMENT group in connection with acquisition of majority equity stake in company Paloma d.d. a Slovenian-based producer of consumer tissue.
Details of the transaction
Paloma d.d.
Paloma d.d. is a Slovenian company with more than 140 years of history in manufacturing and sale of paper hygiene products, being market leader in Southeastern Europe. Company employs about 700 employees, produces more than 68 000 tons of products annually and generates revenues of 85 mil. EUR (2015). Significant majority of its products is exported to markets of Southeastern and Western Europe. Until this transaction, majority shareholder of Paloma was Slovenian government.
ECO-INVESTMENT
Investor, company ECO-INVESTMENT, is a member of a group which includes also one of the largest manufacturers of paper hygiene products in the region of Central and Eastern Europe, SHP Group headquartered in Slovakia. Annual production in its four production sites in Slovakia, Croatia and Bosna and Herzegovina amounts to 100 000 ton of products and its revenues exceed 120 mil. EUR. Through cooperation between SHP Group and Paloma d.d. investor expects that both companies will become in all respects equal competitor to the largest corporations in industry like SCA or Metsä Tissue.
Acquisition of 57.2% equity stake of Paloma d.d. was completed through subscription of new shares in the amount of 18.2 mil. EUR. After the acquisition of shares in the recapitalization process investor published a takeover bid for the remaining shares of Paloma and currently owns 99.64% shares in Paloma. Proceeds from the newly subscribed shares will be used for investments into new production equipment, modernization of processes, improvement of working conditions and energy efficiency of the production. Due to these investments Paloma will become state of the art manufacturer in the region.
KPMG role
KPMG provided complex advisory services including due diligence, valuation, assistance in negotiations of commercial terms, as well as coordination of other advisors and guided the investor through the key steps of the transaction. Managing of effective cooperation, deal expectations and negotiation process led to the successful closing of the deal on December 28, 2016.
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