Tien Wah seals agreement to buy BAT's print materials supplier in Indonesia

KUALA LUMPUR: Tien Wah Press Holdings Bhd’s (TWPH) 51% owned subsidiary Max Ease International Ltd (MEIL) on Thursday signed an agreement to acquire PT Bintang Pesona Jagat (BPJ) that would make the Tien Wah group the exclusive provider of print supplies to the British American Tobacco (BAT) group in Indonesia for six years starting Jan 1, 2017.

In a filing with Bursa Malaysia, TWPH said MEIL and MEIL’s unit Max View Holdings Ltd (MVHL) inked the conditional agreement to buy the 100% equity interest in BPJ from subsidiaries of Indonesia-listed PT Bentoel Internasional Investama Tbk (PTBINI).

PTBINI and its affiliates will appoint BPJ to manufacture and supply the BAT group’s print supplies requirements from Jan 1, 2017, to Dec 31, 2022. No estimated value was disclosed for the contract.

The proposed acquisition is conditional on receiving a written consent from the Investment Coordinating Board in the form of in-principle license or investment license by Dec 7.

TWPH said the proposed purchase was expected to be completed on Dec 15 or a later date as might be agreed by the parties, but no later than Dec 31, 2016.

TWPH’s equity partner in MEIL, which holds the remaining 49% stake, is Singapore-listed New Toyo International Holdings Ltd, the ultimate holding company of TWPH.

TWPH will satisfy its portion of the purchase price with cash, which will be financed by the proceeds raised from the rights issue exercise completed by the company on Aug 9.

MEIL has a printed carton supply agreement with BAT in Singapore and Vietnam that stretches to Oct 31, 2019. The supply agreement with BAT Malaysia's manufacturing arm Tobacco Importers and Manufacturers Sdn Bhd for Malaysia will run till Oct 31 next year