Macfarlane, the Glasgow-based packaging company, has acquired Scotland-based The Pitreavie Group in an £18 million deal.

The earnings-enhancing acquisition, which includes an earn-out of up to £4m over two years, is part of the Macfarlane’s plan to build its protective packaging business through organic and acquisitive growth.

Founded in 2005, Pitreavie designs, manufactures and distributes protective packaging, supplying to customers in the food & drink, energy, electronics and industrial sectors, primarily in Scotland.

For the year ended 31 December 2024, it generated sales of £24.8mi, with adjusted EBITDA of £2.5m and adjusted pre-tax profits of £1.3m.

It has 159 employees across four locations in Scotland including a corrugate box manufacturing plant, newly opened in 2020.

Its senior management team will remain with the business post-completion to support the continued growth of both Macfarlane and Pitreavie

Macfarlane sees significant opportunities for the growth in both companies through their respective industry expertise, ranges of bespoke protective packaging products and common supplier base.

Pitreavie offers corrugate manufacturing expertise and capacity to support Macfarlane’s Distribution business in Scotland and the North of England.

The consideration is being financed entirely from Macfarlane’s existing bank facility. The Group continues to operate well within its recently-improved banking facility of £40m and related covenants, which are committed until November 2027.

Peter Atkinson, chief executive of Macfarlane, said: “Pitreavie is a fast-growing, well-invested company with an experienced management team that is fully committed to the business.

“The acquisition represents a unique and exciting opportunity to grow our business in Scotland and provide in-house supply to our businesses in the North of England.”

“We look forward to working with the team at Pitreavie to support its continued growth and develop opportunities for us to work together to provide our customers with a broader portfolio of protective packaging solutions.”