Kingspan acquires 51% of Brazilian manufacturer

Isoeste operates from four sites with approximately 630 employees

Kingspan chief executive Gene Murtagh said the acquisition would “firmly” place the company in a market leading position

Cavan-based insulation specialist Kingspan has acquired 51 per cent of an insulated panel manufacturer in Brazil as part of its ongoing expansion in the region.

The company informed the Irish Stock Exchange of the stake in Isoeste Construtivos Isotérmicos SA on Wednesday.

Isoeste is a leading insulated panel manufacturer in Brazil, operating from four sites with approximately 630 employees. It forecasts sales of circa R$500 million (€134 million) for 2017.

The move comes after the company signalled its ambition for further expansion in Latin America in its most recent set of interim results.


In April, Kingspan acquired 51 per cent of Panelmet, a leading insulated panel manufacturer in Columbia. It has also recently opened an insulated panels manufacturing plant in Mexico.

Kingspan chief executive Gene Murtagh said the Isoeste acquisition would "firmly" place the company in a market-leading position in the region.

“We are delighted to create this partnership with the founders of Isoeste, the number one player in Brazil’s insulated panels market,” he said.

“Together with our recent investments in Colombia and Mexico, this acquisition firmly places Kingspan in a market leading position across Latin America, with a strong platform for further expansion in the region.”

In a note, analyst Davy said the acquisition marked a “significant step-up” in Kingspan’s “long stated ambition” to expand in Latin America.

Newer regions

“We view the announcement as wholly consistent with Kingspan’s strategy, specifically that of expanding into newer regions as it seeks to expand the group’s global footprint,” it said.

Investec estimated this acquisition would add about 3 per cent to the company’s earnings before interest and taxes next year.

Goodbody noted that, while Kingspan declined to provide any financial details in relation to the transaction, “multiples are likely to be in line with previous transactions”.

“Furthermore, this is likely to be on profits that have been under pressure in recent years,” it continued. “While the financial impact of the latest transaction is not material in the context of the group, it does continue the medium term strategy of building a business of scale in Latin America.”

Earlier this week, Kingspan opened an office in Singapore and said it expected the Asia-Pacific region to be a focus for future growth, with sales on track to double to €20 million this year.

"The future growth will come from markets such as Asia, Latin America and maybe Africa at a later stage," said Manuel Furer, Kingspan's regional managing director for Australasia and Southeast Asia.

The group last year had around €10 million in sales in Asia-Pacific from the office, a figure it hopes to double this year.

Kingspan said there was headroom for “further significant acquisitions”, with “significant available undrawn facilities and cash”. Total available headroom was approximately €706 million at June 30th, 2017.

Colin Gleeson

Colin Gleeson

Colin Gleeson is an Irish Times reporter