ACCO Brands Corporation (NYSE: ACCO), one of the world's largest designers, marketers and manufacturers of branded business, academic and consumer products, recently announced that it has signed a definitive agreement to acquire Esselte Group Holdings AB (Esselte), a leading European office products company, from private equity firm J.W. Childs for $333 million in cash.
Esselte's 2015 sales were $458 million with adjusted EBITDA of $60 million. ACCO Brands plans to combine Esselte with its existing European operations, creating a pan-European leader in branded business products.
Esselte is a leading European manufacturer and marketer of office and consumer products. It takes products to market under the Leitz, Rapid and Esselte brands in the storage and organization, stapling and punch, business machines and do-it-yourself tools product categories. Through its combination with Esselte, ACCO Brands increases its scale and enhances its position as an industry leader in the European marketplace.
The transaction will be funded with cash and Euro-denominated bank debt. As part of the financing, and contingent upon the deal closing, the company intends to refinance its existing senior-secured credit facilities.
As part of the acquisition, ACCO Brands will assume an estimated $160 million of unfunded pension liabilities, net of associated deferred tax, predominantly in Germany. German pension law does not require pre-funding of pension liabilities, which will be payable over approximately the next 40 years.
The closing of the transaction is subject to the satisfaction of customary closing conditions, including regulatory approvals, and is expected to be completed in early 2017.
Turkish law firm, Paksoy, with a team led by Stéphanie Beghe Sönmez (Partner), together with Burak Kepkep (Senior Associate) and Zeynep Toma (Associate), advised ACCO Brands on the Turkish law aspects of this transaction, while Latham & Watkins acted as international counsel.
