Japanese packing material firm Rengo, Thai partner to take over Vietnamese peer
BANGKOK, NNA - Siam Cement Group Public Co., a Thai construction material manufacturer, will join Japanese packaging material provider Rengo Co. in taking over a Vietnamese packaging company to strengthen their business in Southeast Asia.
Bangkok-based Siam Cement said in a filing to the Stock Exchange of Thailand Friday that Thai Containers Group Co., a joint venture between its subsidiary SCG Packaging Public Co. and Osaka-based Rengo, is poised to acquire a majority stake in Bien Hoa Packaging Joint Stock Co. The cement company declined to disclose a deal value.
The joint venture intends to negotiate with Bien Hoa shareholders over its planned acquisition after completing necessary procedures with the State Securities Commission of Viet Nam and the Ho Chi Minh Stock Exchange (HOSE) as required of any applications to buy more than 25 percent shares in a listed Vietnamese firm.
Bien Hoa, whose clients are largely multinational corporations in the consumer segment, runs three factories in the Vietnamese province of Dong Nai, where it’s headquartered, as well as in Binh Duong province. Both provinces are just outside Ho Chi Minh City.
Bien Hoa has capacity to produce 90,000 metric tons of cardboard boxes and 10,000 tons of offset-printed paper boxes a year. In its fiscal year 2019, company sales came to 1.7 trillion dong ($72.6 million) and net profit reached 141.2 billion dong, according to the filing.
Siam Cement hopes that its acquisition of Bien Hoa will help bolster its Southeast Asia business. The Vietnamese firm, it believes, has a competitive edge in packaging for the food and beverage industry in Vietnam, it said in the statement.
The Thai firm has a 70 percent stake in the joint venture, with Rengo taking the rest. Siam Cement is already the largest general packaging provider in Southeast Asia. It operates over 40 factories in Vietnam, Indonesia, Malaysia, the Philippines and Thailand.
Rengo, major Japanese paper packaging material producer, has 157 factories in 28 locations overseas in Asia, Europe and North America. It sells paper products such as corrugated boxes and folding cartons.