Kernel acquires firm with nearly 3,000 railcars

Ukrainian farmer and leading sunflower oil producer
Kernel (KER PW, KERPW) reported on Feb. 18 the acquisition of a 100% stake in
RTK-Ukraine, a company that owns and operates a fleet of 2,949 grain railcars.
The deal’s enterprise value is USD 64 mln, including USD 49 mln cash
consideration already paid. Kernel estimates the acquisition will contribute up
to USD 20 mln to its annual EBITDA.

Andriy Perederey: We agree
with the estimate of the deal’s USD 20 mln annual effect on EBITDA, which
implies an EV/EBITDA of about 3.2x. As Kernel’s forward-looking EBITDA multiple
is more than 5x, the deal looks value-creative for the company. The new railcar
fleet will improve the company’s infrastructure and trading division and will
augment its vertical integration. All in all, this deal looks positive for
Kernel’s equity story.