Duratex acquires Cecrisa in Brazil

Less than two years since the acquisition of Ceusa, Duratex is expanding in the ceramic tile sector with the 100% purchase of Cecrisa for a value of 539 million Reais (around $139 million).

Cecrisa Revestimentos Cerâmicos, one of Brazil’s largest ceramic tile manufacturers with the Cecrisa and Portinari brand names, is changing hands. The total share capital (owned 77% by Vinci Partners and 23% by the Borges de Freitas family) is being acquired by Duratex, a major Brazilian building materials producer and owner of the brands Durafloor (laminate and LVT floors), Deca (sanitaryware and taps), Hydra (heating systems), Duratex (wood panels for furniture and residential applications) and Ceusa (ceramic tiles).

The deal is subject to the approval of the antitrust authority (CADE) and is worth 539 million Reais (around $139 million), around half of which consists of a cash payment while the rest will be paid at a later date when certain conditions are met. Added to this is the value of Cecrisa’s net debt of 442 million Reais (around $114 million).

Cecrisa is Duratex’s second ceramic tile sector acquisition. In August 2017, it invested around $72 million (280 million Reais) to acquire Cerâmica Urussanga (Ceusa), a company with a 2018 output of 5.3 million square metres of tiles.

As the group’s chairman Antonio Joaquim Oliveira explained, the aim of the latest acquisition is to expand the group’s portfolio in the home product sector while strengthening its ceramic industry presence and improving its competitiveness with respect to the major local players. Cecrisa owns three production plants (two in Criciuma, Santa Catarina, and another in Santa Luzia, Minas Gerais) with an annual production capacity of 20 million sq.m and the Portinari premium brand, one of the best known names in the porcelain tile market. The São Paulo-based group also aims to exploit operational and administrative synergies valued at more than $64 million.

Cecrisa, founded in 1966 by Manoel Dilor Freitas, has 1,700 employees and in 2018 posted net revenue of 652 million Reais (around $169 million) and an EBITDA of 17%.

The Duratex group, whose largest shareholders are Itaúsa (Investimentos Itaú SA) with 40% and Companhia Ligna with 20%, posted sales revenue of $1.28 billion in 2018.