Thursday 28 Mar 2024
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KUALA LUMPUR (Aug 11): Tomypak Holdings Bhd has proposed to acquire a Johor-based packaging manufacturer for RM120 million to bolster its packaging manufacturing capacity which was affected by a fire incident.

The flexible packaging manufacturer said it has signed a memorandum of understanding (MOU) to buy a 59.3% stake in EB Packaging Sdn Bhd from Siow Chew Kiong, Teo Kee Lin, Hoo Jik Heng and Teo Peng Hong, and another MOU with RMCP Plastics Holdings Sdn Bhd to buy the remaining 40.7% stake.

The group said it would conduct a comprehensive due diligence and an independent share valuation of EB Packaging shares, as well as consult Securities Commission Malaysia to ascertain that the proposed acquisition will not result in a significant change in the business direction or policy of Tomypak.

It added in a filing with Bursa Malaysia that the move to acquire EB Packaging came after a fire incident that occurred at the group's manufacturing plant in Senai in late 2021, resulting in its manufacturing activities being limited to its plant in Tampoi.

"The Tampoi plant is only able to carry out limited manufacturing activities at a reduced capacity in comparison to the Senai plant," it said.

While Tomypak is in the process of increasing the production capacity of the Senai plant, the group said the EB Packaging acquisition will complement its existing business as well as serve as an alternative source of revenue for the group following the fire incident.

Shares in Tomypak finished 3.5 sen or 8.54% lower at 44.5 sen, giving the group a market capitalisation of RM191.85 million.

Edited ByS Kanagaraju
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