Turpaz Industries takes majority stake in Klabin Fragrance

Turpaz Industries entered into an agreement in September 2022 to acquire 81% of Klabin Fragrance from its founding shareholders, through its American subsidiary Turpaz USA, subject to adjustment against the company’s 2022 performance. Klabin’s 2022 performance fell below the level anticipated at signing, following a reduction in customer inventories during the fourth quarter that affected the sector as a whole amid rising interest rates. The parties subsequently renegotiated the terms rather than applying the contractual adjustment. Under the revised agreement concluded in 2023, the remaining 19% transferred immediately, bringing Turpaz to full ownership; the immediate consideration was reduced to $10–30M, representing an EV/EBITDA multiple of 10x–18x on 2021 figures; and additional consideration of up to 3 million dollars became payable against performance over the period 2023 to 2025. Established in 1994 by Saul Klabin and trading since 1998, the company develops and manufactures fragrance compounds and natural oil blends to customer specification, together with the natural and synthetic raw materials entering into their composition. Its customers manufacture cosmetics, toiletries, candles, body and hair care products, diffusers, detergents and fine fragrances. The company operates from a single production site in New Jersey and recorded revenue of $5–25M and an EBITDA of $0–5M for 2021. Turpaz held existing fragrance operations in the United States and transferred them to the New Jersey facility over the months following completion, consolidating manufacturing, development, information systems and finance functions at that location. Saul and Justin Klabin assumed responsibility for the combined business and joined the group’s management team.