Top Glove share price rise 4.22% on news of Eastern Press acquisition

PETALING JAYA: Top Glove Corp Bhd’s share price rose 4.22% this morning following news of its plan to acquire printing and packaging supplier Eastern Press Sdn Bhd for RM46.25 million cash.
At 10.29am, its share price rose 4.22% or 27 sen to RM6.66 with a total of 969,900 shares traded. The stock closed slightly lower by 0.16% at RM6.39 on Friday with 1.64 million shares done.
Last Friday, the company said it has entered into a sale and purchase agreement for the acquisition, which is expected to provide the group with synergistic benefits, enabling it to improve its supply chain coordination, allowing for flexible planning and better lead time in relation to the supply of packaging material for its glove products, as well as better costs and quality control.
It said the RM46.25 million purchase consideration was arrived at on a willing-buyer willing-seller basis, after taking into consideration the net profit guarantee of RM4.5 million provided to the company for the financial year ending Oct 31, 2018.
The purchase consideration will be funded via bank borrowings and internally generated funds of the group and the proposed acquisition is expected to be completed in the first quarter of 2018.