Packaging products and machinery manufacturer Intertape Polymer Group (IPG) has agreed to acquire Canadian Technical Tape (Cantech) for about $63m.
Based in Montreal, Canada, Cantech is a privately-owned North American supplier of industrial and specialty tapes. It presently has a workforce of about 250.
The acquisition will allow Intertape Polymer to increase its product offering and add new distribution channels for its IPG products across North America and Europe.
The transaction is expected to be closed in the third quarter of this year.
Cantech’s unaudited revenue for the year ending March 2017 was estimated to be $61m. Intertape stated that the purchase price will be finalised, once funds are available.
Intertape is also planning to increase its credit facility from $300m to $450m from IPG. The company stated that the amended credit agreement will continue to include an incremental accordion feature of $150m.
Th emove enables Intertape to further increase its credit limit of this facility if needed, subject to credit agreement’s existing terms and lender approval.
The company expects to use the additional credit mainly to finance Cantech’s acquisition, along with its expansion through other possible acquisitions and capital expenditures in the future.
Intertape Polymer president and CEO Greg Yull said: "We believe that Cantech represents a strong strategic fit with our existing product portfolio and operations. This acquisition should significantly reinforce our presence in our existing tape product lines and customer channels such as the building and construction and retail segments as well as provide access to new business segments.
“The Cantech team has impressed us with their achievements in the industry and we are proud to welcome them to our team at IPG."