Bunzl acquires Brazilian firm amid economic uncertainty

Bunzl, a prominent distribution giant, has revealed plans to enhance its revenue through acquisitions, specifically pointing to the recent agreement to acquire Solupack, a Brazilian food packaging business that recorded revenues of £15 million last year. Despite the turbulent economic climate expressed as 'uncertain', Bunzl's shares began to rise in response to the announcement. The company is actively pursuing additional acquisition opportunities, confirming this as its third takeover in 2025, aligning with their strategy for sustained growth. Estimates suggest that Bunzl’s revenue for the first half of 2025 could increase by approximately 4% from the previous year, thanks to these strategic acquisitions. Additionally, the company has projected its profit margins to remain consistent at 7%, adhering to previously set guidelines even after cutting its profit forecast in April due to tariff challenges facing its North American operations. Frank van Zanten, the CEO, noted that while the macroeconomic environment remains challenging, Bunzl’s performance is meeting expectations. He emphasized ongoing efforts to enhance operations, particularly within North America and Continental Europe, projecting improvements in the latter half of the year. This reassurance comes in the wake of a disappointing profit forecast as the company's stock saw a significant reaction among investors, reflecting the heightened nervousness about market conditions. Analyst Richard Hunter assessed the company’s recent update as reflecting stability amid heightened investor concern over previous profit warnings, indicating that while conditions have not deteriorated significantly, the notable share price fluctuations have dulled investor sentiment.