SPPC acquires UAE-based plastic industries group

13/01/2013 10:05 AST

Saudi Printing and Packaging Company, a subsidiary of Saudi Research & Marketing Group, has acquired 100 percent of Emirates National Factory for Plastic Industries (ENPI), it was announced yesterday.

The UAE-based group was previously owned by Qatar First Investment Bank and Nizar Rajoub and Omar Al-Shamsi. SPPC held a ceremony in Riyadh yesterday to celebrate the acquisition in the presence of Prince Faisal bin Salman, chairman of SRMG.

"The acquisition of ENPI by SPPC was the result of a long journey that began last year to ensure the second phase of the company's growth," said Sulaiman Al-Hudeithi, chairman of SPPC's board, adding that the deal was reached following the board's approval.

"As board of directors, we believe that the growth and success of a number of regional companies listed on the Saudi bourse can be achieved through acquisition and merger," Al-Hudeithi said.

The ENPI specializes in producing solid and flexible plastic products and has eight factories in Sharjah, Abu Dhabi and Riyadh.

Saad Al-Azwari, a member of SPPC's board of directors and CEO, said acquisition is part of the company's strategy and aims at accelerating its expansion in the packaging area.

"This acquisition is part of our strategy to pursue inorganic growth opportunities. We are very excited to add ENPI to our portfolio of businesses and look forward to fully leverage the potential synergies and growth opportunities from this acquisition."

Al-Azwari added: "SPPC was well prepared for growth in accordance with the board's strategic plan. There was a desire for expansion in the packaging sector and ENPI has a number of supplementary products."

The presence of ENPI in the UAE will open a new market for SPPC. "The acquisition is an addition to SPPC's printing and packaging products. It will help us market our products in more than 50 countries."

Jadwa Investment Company has worked as a financial consultant for SPPC to reach the deal with the UAE group.

Sajid Riaz, managing director of investment banking at Jadwa, said: "This is a landmark transaction which will cement SPPC's position as a major regional player in the packaging sector. The innovative acquisition structure will ensure that the transaction is immediately accretive to the shareholders of SPPC."

Riaz added: "This is one of the largest acquisition and merger deals signed by a Saudi company and this a good sign for the progress of holding companies."

QFIB chairman, Abdulla Bin Fahad Al Marri commented: "QFIB's business strategy focuses on investing in companies that demonstrate positive growth potential. ENPI had such capabilities. During our holding period, ENPI managed to successfully grow and expand where its revenue has more than doubled since our acquisition. We are pleased with the successful exit of ENPI which has generated for the Bank an IRR of 31 percent."

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