Cardia Bioplastics announces proposed merger with Stellar Films Group

The proposed merger is subject to completion of satisfactory due diligence by both parties, execution of a sale agreement, shareholder and regulatory approval and other customary closing conditions.

Under the terms of the proposed merger, Cardia Bioplastics will acquire all of the shares and units issued in Stellar Films and issue ordinary shares in Cardia Bioplastics to the owners of Stellar Films. Following completion of the proposed merger, it is currently anticipated that Cardia shareholders will own 42% of the merged group and the owners of Stellar Films will own 58% of the merged group.

The Cardia Bioplastics Board is excited about the intended merger with Stellar Films Group, a business that will complement and strengthen the Cardia Bioplastics business in its product offering, market position and global reach. Stellar Films manufactures and globally markets high quality cast films to the personal care, hygiene and medical product industries. The company is headquartered in Melbourne and operates manufacturing facilities in Melbourne and Port Klang, Malaysia. Over the last fifteen years, Stellar Films Group with average sales over the last three years of over $21 million has developed partnerships with customers in over twenty-seven countries throughout North America, Asia, Africa, the Middle East and Australia/New Zealand. Cardia Bioplastics, established in 2002, develops, manufactures and markets its patented renewable resource-based materials and finished products, for the global packaging and plastic products industries. The company holds a strong patent portfolio and its growth is fuelled by the global trend towards sustainable packaging.

Over the past three years, the companies have collaborated on the production of environmentally friendly Biohybrid films tailored for the global personal care and hygiene products industry. The Biohybrid film produced using Stellar Films proprietary cast film process, exhibits a high performance property profile. It is differentiated through its unique soft touch and warm feel that is ideal for personal care product applications such as diapers, feminine or incontinence products.
As the partnership between the companies deepened, the strategic fit of the two businesses became increasing evident – as did the benefits of a merger, including scale and geographic footprint of combined operations, market access and reach, production and operational savings, complementary intellectual property positions, resources to deliver business strategy and high quality management teams.

As Cardia Bioplastics Chairman, Richard Tegoni stated: “The combined business has the scale and resources to deliver the successful implementation of our profitable business growth strategy in our carrier bags, films & packaging, and waste management target market segments.” (KL)

http://www.cardiabioplastics.com