KUALA LUMPUR (Jan 15): Tien Wah Press Holdings Bhd has entered into an agreement with Cat Loi Joint Stock Company (CLC) to form a joint venture company (JVco) to undertake the business of production of paper packaging, print packaging and other business activities in Vietnam, its Bursa Malaysia filing showed on Monday.

The group’s wholly owned subsidiary Alliance Print Technologies Co Ltd (APTV) has signed an agreement with CLC to establish a company under the proposed name C&A Packaging Company Ltd.

APTV will subscribe to 50% of the charter capital of the JVco for a total cash consideration of VND6 billion (RM1.14 million), while the remaining 50% will be held by CLC.

“APTV has recognised a decline in business revenue in Vietnam since 2019, a trend anticipated to continue throughout 2023 and 2024.

“However, growth opportunities have been identified in the trends of green packaging and e-commerce, which have contributed to an increased demand for paper packaging.

“The compound annual growth rate for paper packaging between 2023 and 2028 is expected to reach approximately 10%, according to forecast data of the Vietnam Paper Association,” the packaging company said.

The deal is expected to be completed by the first half of 2024.

Meanwhile, the proposed joint venture will be satisfied in cash through internally generated funds.

Based on the latest financial report ended on Sept 30, 2023, the group has a cash balance of RM27.47 million.

Shares in Tian Wah finished 1.5 sen or 1.78% higher at 86 sen on Monday, valuing the company at RM123.75 million.