The transaction was concluded for an undisclosed amount. Following the transaction, the market share of the Petrol Group in Croatia will increase from 13% to 23%.
Petrol has announced on Friday that they have acquired a 100% interest in the company CRODUX DERIVATI DVA (Further: CRODUX). The deal was signed on 12 January 2021 with the seller, Mr Ivan Čermak. The transaction will be completed following the fulfilment of suspensive conditions, which include obtaining approvals from the relevant competition authorities.
The mentioned transaction was concluded for an undisclosed amount.
As a result of taking over CRODUX, Petrol Group will acquire 91 service stations. With over 200 points of sale, the market share of the Petrol Group in Croatia will increase from 13% to 23%.
The core business activity of CRODUX comprises import, storage, retail sale and wholesale of petroleum products in the Republic of Croatia. It has more than 1,150 employees and operates 91 service stations.
The acquisition of CRODUX is the largest transaction of Petrol in the past 10 years and represents the most significant one-time increase in the number of points of sale in the Group’s history.
In 2019, the company generated HRK 5.637bn or EUR 760m in sales revenue, with its net profit amounting to HRK 142.9m or EUR 19.3m. The company’s 2019 EBITDA amounted to HRK 316.5m or EUR 42.7m.
Note that Petrol is currently traded at EV/EBITDA of 6.5. Assuming a slightly higher multiple of 7 the transaction would imply EV of app. EUR 300m (considering 2019 results). Given that as of 2019 CRODUX operated with HRK 1.1bn (EUR 145.5m) of net debt this would also imply equity value of EUR 154.5m.
Further investing in widening of its service station network would substantially increase Petrol’s position on the market, so we see the aforementioned as supportive for the share price.
To read about Petrol’s Plan and Key targets for 2021 click here.
Petrol adds that there is still potential for the segment of selling petroleum products and merchandise, which accounts for the largest part of the Petrol Group’s EBITDA, to grow in the coming years, especially in the wider region of SE Europe.
The acquisition of CRODUX is consistent with the existing strategy as well as with the basis for developing a new Petrol Group strategy. The decision was taken also in the light of the fact that the Croatian market is closest to the Slovene market in terms of economic development, maturity of the petroleum product market, purchasing power and cultural characteristics.