SCGP takes controlling stake in Vietnamese packaging-maker Starprint
Thailand's leading packaging company SCGP has acquired Starprint, a premium packaging provider in Vietnam, as part of the company's strategic expansion and growth, SCG's chief executive officer, Wichan Jitpukdee, said on Tuesday.
He said that SCGP had already notified the Stock Exchange of Thailand that the board of directors had approved the acquisition of a 70% stake in Starprint Vietnam JSC ("SPV"), a leading offset folding carton packaging manufacturer.
The document was submitted earlier that day, on the same day as the SCGP press conference.
The deal is worth around 1.050 trillion Vietnamese dong, or approximately 1.534 billion baht.
This merger and partnership (M&P) will be carried out through a strategic partnership with Starflex Pcl ("Starflex"), a leading flexible packaging manufacturer based in Thailand, which intends to take a 25% stake in SPV.
Wichan said that the global packaging market, including in Thailand and Vietnam, will continue to grow as the world economy recovers gradually. This acquisition is expected to assist SCGP in catching up with the trend.
He pointed out that SPV is a leading producer of offset folding cartons, rigid boxes, and luxury packaging in Vietnam, with distinctive printing capability and quality.
It has a prominent client base and a long track record of commercial relationships with renowned multinational and national companies, and its portfolio is heavily focused on high-growth and fast-moving consumer products, he said.
SPV has two manufacturing facilities in Long Binh (Amata) Industrial Zone, Dong Nai, southern Vietnam, with a combined capacity of 16,500 tonnes of offset printing per year and 8 million rigid boxes per year.
The announcement came as SCGP revealed its first-quarter operating results for this year, which showed a 1% increase over the previous quarter with revenue of 33.729 billion baht.
Meanwhile, its net profit increased by 171% to 1.22 billion baht.
Wichan explained that the improved performance was due to the gradual recovery of packaging sales volume in Asean due to rising demand. Other positive factors, such as increased tourism and service sectors, China's reopening, and cost reduction contributed to overall operations improvement.
Aside from strategic business expansions via M&P, SCGP revealed its long-term growth strategy by collaborating with Origin Materials for joint research and development of cutting-edge global innovation — "Bio-based Plastic from Eucalyptus Woodchip" — to meet the demand for eco-friendly products.
He said that this bio-based plastic applied advanced technology to produce Bio-PTA, which is then used to produce Bio-PET for packaging and other products, such as beverage packaging, food packaging, textile and apparels.
This project would support the use of Bio-PET in multiple industries that require sustainable raw materials while also enabling efficient recycling operations, he said, adding that the process was still in its early stages of development.
This year, SCGP is expecting more consistent growth in the third and fourth quarters, and is targeting revenue of 160 billion baht.
