MACFARLANE Group has returned to the acquisition trail with a deal to buy a south of England protective packaging business for nearly £4 million.

Glasgow-based Macfarlane has agreed to pay up to £3.85m in cash for B&D 2010 Group, which employs 15 staff and supplies customers in the aerospace, defence, and space sectors, throughout the UK and internationally, from its facility in Southampton.

The listed Scottish firm said there are significant opportunities to provide B&D’s existing customers with additional packaging solutions and win new customers in the sectors it operates within. B&D generated sales of £2.6m and underlying profits of £0.5m for the year ended December 31, and has enjoyed strong growth in 2023 to date.

READ MORE: Chivas Brothers reveals plans to build distillery on Islay

Macfarlane said its wholly-owned subsidiary, Macfarlane Group UK, has acquired 100% of B&D for a maximum cash consideration of £3.85m, which includes an earn-out of up to £0.55m based on agreed profit growth target over one year. It has financed entirely from its existing £35m bank facility.

Macfarlane chief executive Peter Atkinson said: “B&D is an excellent business servicing high quality customers in attractive growth sectors and complements Macfarlane’s existing specialist protective packaging activities. We look forward to working with the team at B&D to support its continued growth.”

The deal comes after Mr Atkinson said the company had a “pretty healthy acquisition pipeline both in the UK and in Europe” as Macfarlane reported its results for the first half in August.

READ MORE: Soaring costs hit profits at famous Scottish shortbread firm

"We made our first European acquisition last year in Germany, a company called PackMann, and we are very hopeful that we will complete one more acquisition this year,” he said. “And then we will be looking to do more acquisitions as we go into 2024.”

The company made a pre-tax profit of £10m in the first six months of 2023, up 13% on the same period last year. Revenues were 2% higher at £141.6m.