Thai Wah Bio Power, a subsidiary of a SET-listed starch producer Thai Wah Pcl, has acquired a 33.33-per cent stake in Tapioca Development Corporation from Japan Corn Starch for 220 million baht ($6.86 million).
Thai Wah is a major manufacturer and distributor of tapioca starch products and starch-related products such as vermicelli and noodles in Thailand and other Asian countries. Apart from Thailand, it currently has offices in China, Vietnam and Cambodia.
Post transaction, Thai Wah Bio Power owns 66.66 per cent while Thai Wah holds the balance in Tapioca Development.
“We expect the acquisition will help us improve the market expansion of high-valued tapioca starch products as well as boost our revenue and profit in the long run,” said Thai Wah’s chief executive Ho Ren Hua.
The company’s statement on Thursday cited that the share transfer and the payment was completed on April 24, 2019.
The CEO said, it has allocated a budget of 2 billion baht for investment and acquisitions over the next two years in line with its goal to be Asia’s market leader in tapioca starch products.
Thai Wah expects revenue to surge to 10 billion baht this year thanks to revenue recognition from its new plant in Mae Sod and Tapioca Development as well as demand growth in China and Taiwan.
It reported total revenue of 7.32 billion baht ($227.72 million) in 2018, up from 6.48 billion baht ($201.6 million) in the previous year. However, the net profit dropped sharply from 492.91 million baht ($15.33 million) in 2017 to 196.86 million baht ($6.12 million) last year.