Photo by Medco Plast

Indorama Ventures Public Company Limited (IVL) has acquired a 74% stake in Egyptian packaging firm Medco Plast for Packing and Packaging Systems SAE, a subsidiary company of Middle East Glass Manufacturing Co. (MEG).

With a 25% market share, Medco Plast is the largest manufacturer of recyclable PET preforms, injection moulded products, and closures in Egypt, IVL said 14 Nov.

The Dokki, Giza-based company has 11 production lines with an annual production capacity of 70 kilotonnes of PET performs per year, supplying to “all the multinational soft drink and water manufacturers” operating in the country.

IVL expects the acquisition to open the door to the East African PET packaging market, complementing its existing footprint in West Africa, where it has presence in Nigeria and Ghana.

Furthermore, Medco has a strong presence in the Egyptian domestic market, which is one of the most developed and diversified economies in the Middle East, with an economic growth rate of 5%.

“The acquisition of Medco aligns with Indorama Ventures’ strategic focus, which includes capitalising on growth opportunities in emerging markets,” said Aloke Lohia, Group CEO of Indorama Ventures.

Medco Plast was 40% owned by Al Samaha Company, while Middle East Glass and Gulf Capital both had a 30% share in the company. Following the acquisition, MEG will retain a 16% shareholding in Medco Plast, and the Samaha family 10%.

Also commenting on the transaction, Abdul Galil Besher, chairman of MEG, said his company would now focus more closely on its core glass container business.

“The successful sale... highlights the appeal of the large Egyptian consumer market, the increasing confidence in the broader Egyptian economy and the resurgence of foreign direct investments into the country," said Karim El Solh, chief executive officer of Gulf Capital which owns MEG.