Astrapak set to wrap up new deal
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Trade and Industry Correspondent
OVER the past seven years, listed plastic packaging group Astrapak has steadily expanded its operations, a trend that is set to continue with another acquisition in the pipeline.
Since 1999, Astrapak has made numerous acquisitions that have seen the group become the second-largest plastics packaging company in SA. This year alone, Astrapak bought significant shares in Marcom Plastics and Knilam Packaging.
In a cautionary announcement issued yesterday, the group said it had entered into discussions which, if successfully concluded, would materially affect the company`s securities.
Astrapak group commercial director Manley Diedloff said the negotiations were for the company`s next acquisition.
The identity of the entity Astrapak is courting is still unknown but independent analyst Mark Ingham said yesterday Astrapak was likely to consolidate its presence in the plastics industry.
`That (plastics) industry offers tremendous scope for growth,` he said.
Ingham said Astrapak had a history of undertaking acquisitions that not only added value but could be easily integrated into the group.
He said Astrapak was careful about its partners. He cited the Marcom Plastics and Knilam deals as typical Astrapak acquisitions.
Earlier this year, Astrapak acquired 80% of Marcom Plastics, manufacturers of yoghurt containers. It also bought 49% of Knilam Packaging.
`Both of these companies are high-growth businesses with cultures that can be easily integrated into Astrapak. Both are contributing to the group`s revenue,` Ingham said.
He said Astrapak was continually looking for new acquisitions, and that this was likely to continue for a while.
`At the moment, the company has 16% of the market share and 50% of that market share is still in private companies.
`So there is still ample scope for growth for Astrapak,` Ingham said.
The company was likely to continue to seek growth through a combination of acquisitions and start-ups, he said.
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