Advertise with fastmoving.co.za
 
 

Paper and plastic packaging group Transpaco says it will buy Future Packaging and Machinery (FPM) for up to R105m.
Paper and plastic packaging group Transpaco says it will buy Future Packaging and Machinery (FPM) for up to R105m.

Transpaco to buy FPM’s packaging business

FMCG SUPPLIER NEWS

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 

Related News

Spar turns its problem Swiss acquisition profitable
30/05/2018 - 08:43
South African sales would have been higher were it not for the listeriosis outbreak, CEO Graham O’Connor says.

Majority of SA online shopping is done at the office
18/05/2018 - 14:48
More men buy goods online than women in SA and peak shopping time happens during working hours.

Distell and Capevin to complete merger
15/05/2018 - 14:17
The long-standing holding company structure between Capevin and liquor brands giant Distell will officially be dismantled at the end of May.

Decrease in pork price makes it top pick for consumers
04/05/2018 - 09:52
With the continued decrease in the price of pork whilst other meats trend higher, consumers who are feeling the pinch are most likely to settle for pork as an alternative.

Maerua Mall celebrates all moms this May
03/05/2018 - 09:50
This May, Maerua Mall celebrates Mother’s Day – the time of year we honour and thank the moms who changed us, clothed us, fed us, put band-aids on our ‘einas’, taught us the difference between right and wrong, and sacrificed their own comfort and happiness to make our lives better.