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Essentra - Disposal of Packaging division

August 2022

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • ESNT
  • Price:
  • 249.5p
Essentra has announced the proposed disposal of its Packaging division to Mayr-Meinhof for £312m, lower than broker Jefferies’ sum-of-the-parts estimate of £389m in February (but the world was a different place then). The  multiple equates to 12.4x EBITDA.This transaction does not include Packaging India assets, though these are modest. The deal is subject to regulatory approvals being granted and management expect completion in Q4 22. The strategic review of the Filters division is still being undertaken and following conclusion there is scope for a buyback or special dividend. But the main aim is more M&A in its remaining and now dominant Components side.A key landmark moment and once Filters is disposed, there’s ...

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