Flügger Expands Eastward with Eskaro Buy
Danish paints group Flügger has entered into an agreement to take a 70% stake in Eskaro Group, a Swedish-headquartered paint and varnish producer with operations in several eastern European countries.
The deal is pending antitrust clearance, which is expected to be received early next year. Financial terms of the transaction were not disclosed.
Eskaro has six factories in Ukraine, Russia, Belarus, Estonia, Latvia and Finland, producing more than 30 million liters per year of paint, varnish and primer. The company employs about 1,100 people and generates annual revenues of approximately 420 million Danish krone.
Commenting on the acquisition, Flügger’s CEO, Jimmi Mortensen, said: “Eskaro has created a solid platform in eastern Europe, which we believe has potential for further profitable growth. The company has grown by 15% annually since 2016, and we expect to be able utilize significant synergies between Flügger and Eskaro over the coming years.”
Flügger added that Eskaro’s leading position in water-based decorative paints supports its Going Green strategy, where it sees further growth potential in eastern Europe.
Co-founder of Eskaro, Igor Chumakov, will retain a 30% stake in Eskaro and will be responsible for the company’s daily operation and management. He will also develop the company’s short- and long-term business plans in close cooperation with Flügger’s management.
Eskaro said its inclusion in the Flügger group will allow “for more aggressive and bold development.”
Future projects include reconstruction and expansion of production sites to increase capacity, construction of a paint factory in Russia’s Rostov region, the creation of new logistics distribution centers, and the introduction of new R&D developments.
In November 2019, Flügger bought a 60% stake in Polish paint group Unicell, strengthening its position in the country’s DIY market.
Author: Elaine Burridge, Freelance Journalist
