SET-listed packaging manufacturer BG Container Glass (BGC) has completed the acquisition of Prime Packaging, part of its strategy to become a leader in total packaging solutions.
The company's subsidiary BGC Packaging successfully bought 100% of Prime Packaging stock for 580 million baht, with all of the funding coming from bank loans.
BGC expects to start realising revenue and profit from Prime Packaging in the second quarter of 2023, improving the overall performance of the company, said BGC chief executive Silparat Watthanakasetr.
BGC is a leading manufacturer and distributor of integrated packaging in Southeast Asia, including Thailand. The product categories include glass, paper, flexible bags, plastic films, plastic caps, PET bottles, and preform straws.
"BGC has been seeking opportunities to expand its investments from glass packaging, which is the main revenue generator in our portfolio, to other forms of packaging, namely paper and plastic packaging," said Mr Silparat.
Prime Packaging produces and manufactures soft plastic packaging and film reels. The company has reported a continuous rise in total revenue since 2019, although its net profit dropped to 42.1 million baht in 2021 from 43.4 million a year earlier.
According to BGC's filing to the Stock Exchange of Thailand, Prime Packaging's revenue rose from 372 million baht in 2019 to 389 million and 408 million in 2020 and 2021, respectively.
"The acquisition is in line with the company's move to strengthen and expand investment in the flexible packaging business to meet growing demand," said Mr Silparat.
The investment in flexible plastic packaging will enhance BGC's ability to offer customers a wide and complete range of packaging, he said.
"In addition, the timing of the deal is convenient as the Thai economy and the tourism sector are entering a recovery period, which will help support the business," Mr Silparat said.
Offering packaging, labels, lids and boxes, the company should be able to expand its customer base and order numbers per customer, as well as increase the proportion of income from other packaging business groups, he said.
