M&As: RPC to acquire Nordfolien for EUR75 mn; Siam Cement to pump up stake in Vietnamese pipe maker

UK-based packaging company RPC Group is acquiring German packaging and film manufacturer Nordfolien for EUR75 million.

Nordfolien, which was founded in 1966 and acquired by PSP Beteiligungs in 2003, manufactures PE films for both industrial and consumer packaging markets and has two well-invested sites in Germany and Poland, including in-house recycling capabilities. It has also developed, patented and commercialised a number of products. The Nordfolien management team will continue to operate the business from its current locations.

RPC says that after the successful acquisition and transformation of BPI Group, which is now generating a return on capital employed (ROCE) in excess of 15%, the acquisition of Nordfolien represents an important next step in growing its flexibles platform. The acquisition will also augment BPI’s market positions in Europe, as well as providing access to higher growth geographies including Eastern Europe. Nordfolien also has capacity that can be utilised by BPI for further growth without incurring additional capital expenditure.

The consideration of EUR75 million is being funded from RPC's existing debt facilities. Nordfolien is expected to report revenue of EUR130 million for the same period. Completion of the acquisition is subject to clearance from the Polish and German competition authorities, and is expected in the first half of the financial year ending March 2019.

Meanwhile, in other news, Thailand’s Siam Cement Group (SCG), through its subsidiary Nawaplastic Industries, will purchase an additional 29.51% stake in Vietnamese plastic producer Binh Minh Plastic JSC (BMP). The stake is represented by 24 million shares previously offloaded by Vietnam’s sovereign wealth fund State Capital Investment Corporation (SCIC). The deal is valued at US$101.2 million.

With this, Nawaplastic intends to increase its ownership in BMP to 49.91%, thus solidifying its position as the largest stakeholder in the plastic company.

Set up in 1977, Binh Minh Plastics manufactures plastic pipes and fittings. Aside from Nawaplastic, its other investors include Franklin Templeton Investments that owns 10.78%.

Nawaplastic had earlier divested its entire 24% stake in Tien Phong Plastic JSC, a competitor of BMP, for about US$66 million.

The Thai group also holds shares in a number of companies specializing in the production of household plastics, including Viet-Thai Plastchem, TPC Vina Chemical and Plastic Corporation, and Minh Thai House Component.

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(PRA)