Filtrona in cash call to fund acquisition

PLASTICS group Filtrona yesterday called on investors to fund a £160m acquisition of medical packaging group Contego Healthcare.

Financing for the deal came from the proceeds of a placing of 21.1m shares – 9.99 per cent of Filtrona’s share capital – while the balance will come from existing debt facilities.

FTSE 250-listed Filtrona yesterday said it had raised £142.7m from the placing, mainly from institutional shareholders.

Pan-European focused Contego – which marks Filtrona’s seventh deal in two years – logged revenues of £102.7m over the full year, and Filtrona said that the company is expected to boost its earnings immediately.

Contego’s product portfolio is complementary to Filtrona's existing packaging business that supplies the pharmaceutical and healthcare markets with items such as labels and tear tape, the London-listed firm said yesterday.

Chief executive Colin Day told City A.M. yesterday that cost synergies of at least £4-5m could be achieved with the Contego acquisition. He added that the company also had two smaller bolt-on acquisitions in the pipeline.

ADVISERS
DEUTSCHE BANK

LORCAN O’SHEA
MATT HALL
DEUTSCHE BANK

Deutsche Bank is acting as the corporate broker to Filtrona, with Matt Hall, a director in corporate broking, and Lorcan O’Shea, head of UK and Ireland equity capital markets, working on the transaction.

O’Shea has been with Deutsche Bank since 2010 and has worked in investment banking for 18 years. Aside from Filtrona, the banker has worked on transactions in the UK this year for Phoenix Group, and Ophir Energy, and is currently leading the esure IPO.

Hall has been with Deutsche Bank for three years, having previously worked at Credit Suisse for over 12 years. He has worked in both equities and corporate broking during his career. At Deutsche Bank, Hall’s deals include the Reckitt Benckiser acquisition of SSL and Premier Oil's deal with Rockhopper to explore the Falklands.

On the legal side, Slaughter and May worked for Filtrona, led by corporate and commercial partner Jeff Twentyman.

Law firm Baker & McKenzie acted for Platinum Equity, which sold Contego. The team was led by Karen Guch.