What: Blue-chip pallet, crate and container pooling operator Brambles Limited (ASX: BXB) has today announced the acquisition of Germany-based bulk container company Transpac for approximately $62 million. The news has sent the stock up 0.7% on a day when the S&P/ASX 200 Index (Index: ^AXJO) (ASX: XJO) is tracking 0.3% higher.
So what: Transpac continues Brambles strategy of making bolt-on acquisitions to its pooling operations. The acquisition looks reasonably priced with the purchase price representing a multiple of 11.3x earnings before interest, tax, depreciation and amortisation (EBITDA) for a business which grew sales revenue by 18% per annum for the past two years.
Now what: Having provided third-quarter guidance back in April of 7% growth on a constant currency basis, Brambles appears to have solid growth momentum across all its operating segments. Neat bolt-on acquisitions such as Transpac have the potential to continually add incremental synergies and revenue growth to the business. Importantly for shareholders, there appears to be a long pipeline of these sorts of opportunities available to Brambles across its global operating regions.
