Mercer aims to be Germany’s largest pallet producer with HIT takeover15 August 2022
Mercer International Inc is set to significantly expand its solid wood operations by announcing plans for a €270m acquisition of Holzindustrie Torgau (HIT).
HIT owns and operates an integrated timber processing facility with wood pallet, lumber, biofuel and energy production.
HIT is the world’s largest producer of EPAL wood pallets used for shipping.
For fiscal year 2021 HIT had net revenues of €227m, including approximately €169m from pallets, €17m million from other lumber, wood and milled products, plus €27m from biofuels and €12m from electricity. It recorded adjusted EBITDA of €68m.
For the first quarter of 2022, HIT had revenues of €72m and adjusted EBITDA of €22m.
The acquisition would make Mercer the largest German pallet producer and have a combined annual lumber capacity of approximately 2.26 million m3 with incremental electricity generation capacity.
HIT runs a timber processing and value-add pallet production facility in Torgau, Germany and a wood processing facility in Dahlen, Germany that produces garden products.
The Transaction is subject to customary closing conditions, including receipt of requisite regulatory anti-trust approvals. The Transaction is expected to close in the third or early fourth quarter of 2022.
“This acquisition significantly increases our solid wood operations in Germany,” said Juan Carlos Bueno, CEO of Mercer.
“It will allow us to capitalize on synergies with our German operations, including complementing our Friesau sawmill. Additionally, the acquisition will allow us to diversify our product mix with the introduction of pallets and biofuels.”