Bunzl adds two US firms to its stack

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The Independent Online
BUNZL has continued its series of strategic acquisitions with the purchase of two US companies. This brings the number of takeovers by the paper and packaging group to five in just under a year.

Bunzl has paid about dollars 12m ( pounds 8m) for Ziff, a New England distributor of paper and plastic disposables, and MSI, a Texan manufacturer of plastic fittings for the oil and gas industry.

David Williams, Bunzl's finance director, said: 'We are continuing to add to the business in areas we feel we already have expertise in. We are confident that both acquisitions will prove to be worthwhile.'

Analysts agreed that the two acquisitions, although small, reinforced Bunzl's core activities. The management team brought in to rescue the company in 1991 has focused on paper and plastic disposables - which contributed 45 per cent of group sales and 55 per cent of operating profits at the interim stage - and on the US market.

Jonathan Heliwell, an analyst at James Capel, said: 'The deals are exactly along the lines we would have expected. They are useful additions in two of Bunzl's strongest areas.' The shares rose 4p to 171p.

Ziff had sales of dollars 54m in the year to August 1993, and made losses. Mr Williams said: 'We can see it moving into profit within a reasonable period.' Ziff's net assets of about dollars 500,000 include an unspecified amount of bank borrowings. The company will become part of Bunzl Distribution USA.

MSI broke even with sales of dollars 4.5m in the year to December, and has net assets worth dollars 2.8m. It will be merged with Alliance Plastics, Bunzl's injection-moulding business.