Transpaco to buy FPM’s packaging business
By Nick Hedley - Dec 19th 2017, 13:36
Paper and plastic packaging group Transpaco says it will buy Future Packaging and Machinery (FPM) for up to R105m.
"FPM is an attractive target business prospect for Transpaco to expand its business," Transpaco announced on Monday.
Its share price rose 1% to R22 in light trade on Monday.
FPM supplies industrial and general packaging products and sells them through three major distribution centres, in Johannesburg, Cape Town and Durban, and two smaller depots in Bloemfontein and Nelspruit.
"FPM has achieved consistent growth in sales and profitability since inception."
"Transpaco seeks access to the large customer base that FPM currently services and its extensive product range to add to Transpaco’s existing offering," the group said.
The maximum estimated purchase price would be R105m, depending on the target company’s audited financial statements for the year to end-February 2018, Transpaco said.
It would pay a premium of R37.2m to the book value of the net assets being acquired and would fund the deal with existing facilities and cash resources, it said.
FPM expects to generate turnover of R461m and net profit after tax of R20m in its financial year ending February 2018.
Transpaco said FPM was "highly profitable and cash generative", while it had well-known products and services and an "experienced and self-sufficient management team".
It also had "strong growth prospects, arising from its established position in SA and opportunities to further expand municipal, industrial, wholesale, retail, agricultural and export markets".
Transpaco could extend FPM’s product offering to its own customers. The deal was expected to enhance Transpaco’s earnings.© BusinessLIVE MMXVII
Slight upturn in prospects for SA 2019/2020 stone fruit exports
16/10/2019 - 10:11
The latest forecast for South Africa's stone fruit season points to improved volumes compared to last year although the continued effects of drought in some areas and adverse weather during pollination has impacted the full potential, an industry body said on Tuesday.
Shoprite makes significant positive impact
10/10/2019 - 11:01
The Shoprite Group’s significant positive impact in the countries and communities in which it operates have seen it subsidise staple products to the value of R141 million, donate surplus food and goods to the value of R60.4 million and serve more than 20 million meals to communities in need in the 2019 financial year.
Shoprite works to prevent childhood stunting
08/10/2019 - 09:46
The Shoprite Group has announced investment in several specific interventions to prevent childhood stunting which leaves one in four South African children under the age of five with lifelong cognitive, educational and employment challenges.
Health innovation is an opportunity for South African brands across multiple industries
23/09/2019 - 14:22
With government striving to pass legislation to create a National Health Insurance (NHI) scheme to serve all South Africans, the country’s health and wellness market is in flux. Along with the global trends reshaping the sector, this is a recipe for massive change and disruption that could have wide implications for consumer brands in every segment.
Multi-million rand Rustenburg Mall underway
09/09/2019 - 11:07
Rustenburg shoppers can look forward to a brand new shopping centre – Rustenburg Mall – set to introduce its first phase in April 2021.