BRITISH Polythene Industries (BPI) has strengthened its position in the food sector with the £5.5 million cash acquisition of Cheshire-based Flexfilm.
Flexfilm and its Irish subsidiary, Jordan Plastics, turned over £13.4m last year by selling film and printed bags to the food industry. Operating profits were £800,000.
The acquisition is in line with BPI’s strategy to ditch less profitable business in favour of “resilient” markets such as agriculture, healthcare and food retailing. However, it will contribute towards an increase in debt at the half-year stage.
Details of the deal were unveiled by BPI chairman Cameron McLatchie in an update to shareholders before the group’s annual general meeting in Greenock.
McLatchie said BPI anticipates a good result for the first half, with “no reason to change our view” that the year as a whole would prove satisfactory. Results for the first four months are ahead of the same period last year, he added.
However, trading conditions remain “challenging” as cooler weather delayed demand in certain sectors.