Thai plastics maker Indorama to buy Vietnam bottle maker Ngoc Nghia

Van Dat Friday | 01/14/2022 11:10

Photo: Ngoc Nghia

Thailand-based Indorama Ventures, a global sustainable chemical firm, is under process to acquire shares in Ngoc Nghia Industry – Service – Trading JSC, Thai plastics producer said in a statement.

The acquisition is part of its plan to expand packaging business into Vietnam and strengthen market position in Asia-Pacific.

Though the deal value was not disclosed in the statement, the company is expected to pay up to 3.09 billion baht ($92.5 million) for all outstanding shares of Ngoc Nghia, according to a stock market filing. The deal is expected to be completed as early as the first half of this year.

Ngoc Nghia is a leading PET converter in Vietnam with long-standing relationships with major brands. It has four manufacturing sites in both the North and South of Vietnam. It has a total production capacity of approximately 5.5 billion units of PET preforms, bottles and closures, or equivalent to a PET conversion of 76,000 tons per annum.

Operating with high quality standards, the firm is a trusted provider of PET packaging products to major multinational and Vietnamese brands in the beverage and non-beverage industries. Its business operations are run by an experienced management team with strong industry knowledge as well as local market exposure and understanding.

These competitive advantages are strategic fits for Indorama and would complement the company’s long-term growth after integration. This proposed acquisition will strengthen Indorama’s market position in the packaging business in high growth markets of the Asia-Pacific region.

The investment opportunity is in line with Indorama’s business strategy of expanding footprint in rising economies like Vietnam. The country is positioned to be the ASEAN production hub for the Asia-Pacific region, said Mr. D K Agarwal, CEO of Combined PET, IOD and Fibers Business at Indorama Ventures.

Vietnam’s PET packaging market is expected to grow continuously due to strong growth in consumption and improving living standards. The proposed acquisition would foster sustainable growth in the firm’s largest business segment, which has been growing constantly to serve increasing demands globally, he added.

Ngoc Nghia makes bottles for Unilever, Pepsi, Cocacola, Nutifood, Vinamilk, Asia Brewery, and other major F&B businesses. In October 2021, the State Securities Commission confirmed that Ngoc Nghia had no foreign ownership limit.   

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