TOKYO, Feb. 28, 2014 (Press Release) - Oji Holdings Corporation would like to announce that the decision to incorporate a subsidiary in Myanmar to build and start operation of a new corrugated container factory in Mingaladon Industrial Park, which is located in the suburbs of Yangon city, Myanmar, has been approved in the Board of Director's meeting held today.
1. Corrugated Container Business in Myanmar
As one of the key measures of our business portfolio restructuring, Oji Group has been aggressively expanding its Packaging business in Southeast Asia and India. Following its transition to a democratic government in 2011, Republic of the Union of Myanmar, with its rich natural resources, has been attracting worldwide attention as an investment destination, and undergoing rapid economic growth recently. In particularly, in Yangon, which is the economic center of Myanmar, aggressive investment from the world has been progressing and market entries into industries such as textile and garment, food and beverage, etc has been continuing. Furthermore, the allocation of industrial land in the Thilawa Special Economic Zone, which is developed by a consortium formed between Japanese enterprises and Myanmar government and enterprises, is scheduled to start in 2015. Therefore, in the future, an acceleration of investment in Myanmar led by Japanese enterprises is expected.
Currently, only a few suppliers of corrugated container are equipped with modernized converting facilities in Myanmar, and we will be the first major international manufacturer to operate in this country. By utilizing our excellent production technology honed in the Japanese market, as well as the business know-how and human resources from our existing operations in Southeast Asia, we will supply quality products and services that will fully satisfy clients in Myanmar, to cater to the increasing demand for corrugated container as the economy continues to develop.
As of now, Oji Group's Packaging business in Southeast Asia, consists of 18 manufacturing sites. In addition, with the decision to acquire UPJV in Vietnam in December, 2013, and the construction of a new factory in India that is scheduled to start up in July, 2014, this new factory in Myanmar will be our 21st manufacturing site in Southeast Asia and India. In this same region, Myanmar will be the 6th country in which Oji Group makes its market entry, after Vietnam, Malaysia, Thailand, Cambodia and India.
2. Overview of Company and Factory
GS Paper & Packaging Sdn Bhd, which is a subsidiary in Malaysia (held by Oji HD 75% and Marubeni Corporation 25%), will invest majority of the shares to establish a company in Myanmar as a joint-venture with a local business partner, which builds and operates a new corrugated container factory in Mingaladon Industrial Park, located in the suburbs of Yangon city.
Company Name Oji GS Packaging (Yangon) Co.,Ltd.
Business Line Manufacturing and Sales of Corrugated Container
Establishment March, 2014 (planned)
Share Capital US$15,500,000
Location Mingaladon Industrial Park
Mingaladon Township, Yangon, Myanmar (20km north from center of Yangon city)
Site Area 25,000㎡
Investment US$15.4million (approx.. 1.6billion JPY)
Production Capacity Corrugated sheet : 42million㎡/year Box & Printing : 25million ㎡/year
Start-up Date May, 2015 (planned)
3. Impact on financial results
There will be no impact on our financial results' forecast ending March 2014 due to this project.