The purchase of casing collagen division from the Japanese Group Nitta Gelatin Inc. by Spanish group Viscofan (VIS:SM) will be made via debt for 10.7 million dollars and in cash for 2.8 million dollars. The price paid corresponds to an EV / EBITDA of 9.0x. In addition, the agreement includes an additional payment of 1.5 million dollars in 2021 if Nitta reaches an EBITDA of 1.8 million dollars.
The operation would reduce the EV / EVITDA paid to 8.3x. Nitta is one of the most important collagen producers in the United States with average annual sales of $40 million.
Bankinter analysts commented on the purchase that it is a “small but positive operation. Preliminarily, we believe that it strengthens its position in the United States within the collagen segment. And the multiples paid create value from the first year because the PER paid has been 14.1x compared to 18.2x Viscofan. And the Viscofan EV / EBITDA 11.2x versus the 8.3x / 9.0x Nitta range.”