Nuplex Industries says its purchase of an Australian chemical additives business is an example of the company's growth strategy in seeking out valuable, "bolt-on" acquisitions.
The Sydney-based speciality chemicals and resins manufacturer has gained regulatory clearance from the Australian Competition and Consumer Commission to acquire for A$23.5 million ($29.5 million)the Masterbatch business of privately owned Acquos, a Melbourne chemical firm.
Acquos Masterbatch manufactures additives - known as masterbatch - that colour and enhance the performance of plastics used in consumer packaging, as well as industrial and agricultural applications such as wire coatings and plastic sheeting.
Nuplex said Masterbatch was complementary to its existing Australasian masterbatch business, Culamix, and would give the ASX- and NZX-listed firm new colour technologies and the capability to manufacture black masterbatch.
Culamix and Masterbatch would be combined to form Nuplex Masterbatch, which would be the leading masterbatch supplier to the Australasian plastics industry, the firm said.
The acquisition would be fully funded through existing debt facilities.
"One key element of our growth strategy is to seek out value adding bolt-on acquisitions in our established markets.
"Acquos Masterbatch is a good example of this strategy in action. It meets our disciplined bolt-on acquisition criteria of building market-leading positions, delivering upfront earnings momentum and generating additional synergies over time," said Nuplex chief executive Emery Severin.
The company beat its own guidance when it reported a 3.6 per cent rise in full-year net profit to $66.5 million last month, on revenue of $1.57 billion.
Nuplex shares closed down 8c at $2.87 on the NZX last night after going ex an 11c dividend.
