Irish paper-based packaging products manufacturer Smurfit Kappa Group has reached a deal to acquire Dutch paper and recycling business Reparenco for around €460m.

Reparenco operates a two machine paper mill in the Netherlands with a capacity of 675,000t as well as a 750,000t recovered fibre operation.

The mill comprises two machines with a capacity of 405,000t of recycled containerboard and 270,000t of graphic paper.

"The acquisition of Reparenco is complementary with our existing business; strengthens our integrated business model; and accelerates a central element of our medium term plan."

With gross assets of €189m, the Dutch company has a workforce of 315 people.

In the 12 months to April this year, the company generated earnings before interest, taxes, depreciation, and amortisation (EBITDA) of €41m.

For Reparenco, the deal represents 6.4 times the value of its expected full-year 2018 EBITDA of €72m.

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Smurfit Kappa Group CEO Tony Smurfit said: “We are pleased to announce our agreement to acquire Reparenco, successfully concluding a process which began on 01 February this year.

“The acquisition of Reparenco is complementary with our existing business; strengthens our integrated business model, and accelerates a central element of our medium-term plan.

“We welcome all the Reparenco employees to Smurfit Kappa. We believe there is a strong cultural fit between our businesses and that, together, we will generate value in the short, medium and long term for all our stakeholders.”

The transaction will provide near-term synergies to Smurfit Kappa in several areas, including increased integration of containerboard and the recycling operations into the group.

Conditional on certain closing conditions and receipt of regulatory approval, the transaction is anticipated to be completed within four to six weeks.