NanoXplore Inc. a world-leading graphene company, announced that it has acquired all of the issued and outstanding shares of Canuck Compounders Inc. (“Canuck”) for a total cash consideration of approximately $9.3 million subject to post-closing adjustments, which represents a multiple of approximately five times of the average EBITDA(1) of the last three years.
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Canuck, a privately held plastic recycling compounder for the past 30 years, provides sustainable and engineered recycled plastic compounds for use in transportation, building and construction, agriculture and packaging markets. Canuck’s manufacturing facility, based in Cambridge, Ontario, has a production capacity of approximately 40 million pounds annually.
“I am very pleased with this acquisition and would like to welcome Canuck’s team to the NanoXplore family,” said Dr. Soroush Nazarpour, Chief Executive Officer of NanoXplore. “This acquisition is strategically aligned with our growth initiatives and significantly increases our graphene compounding capability, especially in recycled plastics and will enable us to form strategic partnerships with end customers. In addition, Canuck has a strong relationship with recycled plastic suppliers that ensures a smooth and reliable supply of post-consumer and post-industrial recycled plastics. This transaction will enhance our technical expertise in recycled plastic compounds and bolster our top-line by approximately $20 million annually, without considering revenues derived from graphene inclusion.”
NanoXplore paid $7.3 million in cash at the closing of the transaction, while $1 million in cash will be paid in one year and another $1 million will be paid in two years. Following the transaction, William Dickinson, CEO and founder of Canuck, will continue in a role as General Manager, alongside approximately 40 employees.
“We are delighted to join forces with NanoXplore, given the inherent technological and cultural fit between the two companies,” Mr. Dickinson said. “Graphene from NanoXplore is highly complementary with our recycled plastic compounds to create innovative solutions like enhanced masterbatch and mixtures, while both management teams are dedicated to delivering best-in-class products across a broad number of growth industries.”
As demonstrated by the Canuck acquisition, NanoXplore is seeking to expand its downstream, value-added product offering through enhanced masterbatch and compounds, Anode and Cathode pastes, battery materials for the Li-ion battery market, formulated thermoset resins, and admixtures for cement.
“This expansion of activities positions NanoXplore, not only as a world-leading graphene company, but also as a provider of graphene-enhanced, ready-to-use solutions,” Dr. Nazarpour added. “Such value-added formulations support the Company’s profitability in the long term and provides a competitive advantage over other graphene producers in the future. We anticipate that such expansion of activities will be carried out through a combination of acquisitions and partnerships.”