KUALA LUMPUR (May 17): Kumpulan Perangsang Selangor Bhd (KPS) is acquiring plastic injection moulding company Toyoplas Manufacturing (Malaysia) Sdn Bhd for RM311.25 million.

Toyoplas Manufacturing is principally involved in the business of plastic injection moulding with an integrated capability from mould fabrication to precision injection moulding and assembly, with operations located across seven locations in China, Malaysia and Indonesia.

In a filing with Bursa Malaysia today, KPS said its wholly-owned subsidiary Perangsang Dinamik Sdn Bhd has entered into a share sale agreement with Toyoplas Consolidated Ltd today for the purpose of the acquisition.

KPS's board believes that acquiring Toyoplas Manufacturing, with its diversified geographical presence and industry mix, will allow the group to diversify its geographical revenue mix and enlarge its regional footprint via the cross-selling of each other’s capabilities leading to an enlarged customer base.  

Besides that, KPS pointed out that the proposed acquisition presents an opportunity to expand its manufacturing sector specifically in plastic injection moulding and its related businesses that are currently undertaken by its wholly-owned subsidiary CPI (Penang) Sdn Bhd.

KPS said the proposed acquisition will be funded via a combination of its internally-generated funds and bank borrowings. It said that it is in the process of securing loan facilities to partly finance the acquisition with a minimum amount of RM150 million.

Barring any unforeseen circumstances, the proposed acquisition is expected to be completed by the third quarter of 2019.   

Shares of KPS closed unchanged today at RM1.13 with a market capitalisation of RM607.25 million.