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Cardia to derive benefits from Stellar Films merger
Mar '15
According to Cardia Bioplastics Ltd, the proposed merger with Stellar Films Group will enable it to deliver on the growing demand for its Biohybrid hygiene films without extensive investment in capital equipment.

Cardia has the opportunity to further increase its blown film extrusion and bag making capacity through limited capital investment into Cardia's Chinese and Stellar's Malaysian production plants.

“The integration of the group's operations will deliver innovative, cost effective and environmentally preferred packaging solutions to its global customers,” Cardia said in a press release.

The group benefits from the pull-through of Cardia Compostable and Biohybrid resins for the manufacture of cast films at Stellar's manufacturing plants.

“These environmentally friendly, high quality and cost competitive films are tailored for the global personal care, hygiene products, pet care and medical packaging industries,” Cardia informed.

Further according to the company, value is added through the Akronn joint venture, which will silicone coat Biohybrid cast films and convert them to film release liners for the personal care and hygiene industries.

Biohybrid film release liners deliver innovative, soft touch, non-noisy and discreet environmentally friendly feminine hygiene pouch packaging that integrates non-stick functionality into the product packaging.

The merged group will benefit from the complimentary geographic presence of both Cardia and Stellar operations.

With its three manufacturing plants located in Australia, China and Malaysia, the group is well positioned to supply the growing demand of its expanding Asia Pacific customers.

Asia Pacific is the fastest growing market of the $72 billion absorbent hygiene products industry and to increases its share, Cardia will prioritise its financial resources to ensure production output is optimised.

The established nature of the existing Stellar Films operations will ensure supply of high quality Bioplastics film products with product approval processes already commenced with key target customers.

Cardia's ability to deliver the highest quality product in a timely manner will underpin the continued growth of sales to these strategic global customers.

“The need to act quickly and implement the realignment of the group's production assets and resources is a key priority,” Cardia noted.

The merged business will prioritise its resources to its strategic higher value growth opportunities for sustainable resins and finished products.

Cardia has therefore taken the strategic decision to discontinue funding of its Brazilian film and bag making operations.

Despite the discontinuation of its film and bag making operations, Cardia will remain committed to the Brazilian market place and will focus on supply and distribution of Biohybrid resins. (AR)

Fibre2fashion News Desk - India

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