Daibochi acquires flexible plastic packaging player for RM125 million cash
Melaka, Malaysia, 3 May 2019 – Leading flexible packaging manufacturer Daibochi Berhad, formerly known as Daibochi Plastic And Packaging Industry Bhd, (Daibochi; 耐慕志; Bloomberg: DPP:MK; Reuters: DPPM.KL) proposed to acquire the entire equity of flexible plastic packaging (FPP) player Mega Printing & Packaging Sdn Bhd (MPP) for total cash consideration of RM125 million.
Established in 1997, Melaka-based MPP manufactures downstream flexible packaging comprising roll-form and pre-made pouches with laminated structures mainly for F&B applications, including confectionary, snacks, noodles and powdered beverages.
Daibochi will acquire 4.5 million ordinary shares in MPP for RM125 million. The purchase consideration, which will be funded through internally-generated funds and/or bank borrowings, represents an Enterprise Value (EV) over EBITDA of 8.07 times based on MPP’s audited financial results for the financial year ended 31 December 2017.
Mr. Thomas Lim (林树坤), Managing Director of Daibochi Berhad said:
“Getting on the acquisition trail places Daibochi on the higher growth trajectory, even as we strengthen our position as a super regional player in the FPP segment.”
“This acquisition sees two leading FPP giants with strong track records joining forces, possessing cumulative experience of close to 70 years. The exercise not only combines our respective prowess in product portfolio and manufacturing capacities, but also extends our reach through the wider network of customers and suppliers.”
“Moreover, the proposed acquisition effectively pools resources including human resources, technical expertise and market insight, in addition to enhancing raw material purchases and other efficiency measures that would be beneficial for customers of both Daibochi and MPP.”
“From a larger perspective, MPP would come onboard the Scientex growth partnership platform within the Daibochi fold, to fulfil increasing demand from multinational corporations and brand owners locally and abroad.”
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