Kesko (KESKOB) M&A announcement summary

Deal rationale and strategic fit

• Acquisition targets leading technical trade and HVAC operators in Sweden, Norway, and Denmark, aligning with growth strategy and strengthening market position in the Nordics.

• Target companies have strong brands and no overlapping business with the acquirer in the target countries, complementing existing operations and expanding product portfolio.

• Megatrends such as renovation, urbanisation, green transition, and digitalisation support long-term growth.

• Deal supports internationalization, with 71% of construction and technical trade revenue expected from outside Finland post-acquisition.

• The acquisition marks the largest in company history, aiming to make technical trade the biggest division.

Financial terms and conditions

• Debt-free transaction price is €1.2 billion (or €1.518 billion including lease commitments).

• Combined 2025 net sales of acquired companies total €2.068 billion, EBITDA €146 million.

• EV/EBITDA multiple based on 2025 EBITDA is approximately 10.4.

• Acquisition to be financed initially with bridge financing, later refinanced with equity and debt; planned share issue of €500–700 million.

• Transaction costs are estimated at €8 million.

Synergies and expected cost savings

• Synergies expected mainly from higher purchase volumes, procurement, private labels, and IT systems, nearly tripling sales volumes in HPAC products.

• Profit improvement anticipated in line with operating margin target of 6–8%.