Poland pays off again for Bounty
• Fast-moving consumer goods business buys household products manufacturer as it implements plans to become multinational consumer business
Bounty Brands, the fastmoving consumer goods business with plans to list on an international bourse and the JSE, has made another acquisition in Poland.
Bounty Brands, the fast-moving consumer goods business with plans to list on an international bourse and the JSE, has made another acquisition in Poland.
This week, Bounty – which is controlled by Cape Town-based investment firm Coast2Coast — announced the acquisition of Poland-based Stella Pack for an undisclosed amount.
Like JSE-listed healthcare brands conglomerate Ascendis — which is also controlled by Coast2Coast — Bounty has followed an aggressive growthby-acquisition strategy over the past two years. Stella Pack manufactures recycled refuse bags and other nonchemical household products and is Bounty’s second venture in Poland after the acquisition of specialist food business Sonko in late 2015.
Stella Pack complements Bounty’s existing investment in Tuffy, the local manufacturer of recycled refuse bags.
In 2016, Stella Pack generated revenue of about R820m with international sales (outside Poland) representing around 40% of top line.
Earlier in 2017, Bounty Brands acquired Genesis, a R360m-a-year South African manufacturer and distributor of cleaning products and accessories into the cleaning services market. More recently the company snapped up Nuance Brands, which owns the exclusive right to import and retail the SuperDry brand in SA.
Bounty CEO Stefan Rabe said it continued to make progress with its strategic aim of creating a successful multinational consumer brands business.
“In particular, Stella Pack further diversifies our income stream geographically and pro- vides us with leading brands in Home Care in a key central and eastern European market.”
This week Bounty released financial highlights for the year to end-June with revenue up 131% to R3.2bn and ebitda (earnings before interest, tax, depreciation and amortisation) up 150% to R384m with margins fattening to 12% (the previous year’s margins: 11%). The cash conversion rate was 103%, up from 82% in 2016. Sales from central and eastern Europe accounted for 28% of group revenue. Rabe said Bounty had made a significant investment in its executive team in 2017 in a bid to accelerate the integration of similar businesses and to prepare it for potential listing.
Domenic De Lorenzo, a former executive at brewing giant SABMiller, has joined the Bounty board as an independent nonexecutive director.
Rabe said he believed De Lorenzo would play an important role in growth and governance at Bounty as chairman of the audit committee.