Dipped Products to acquire 70% stake in Hanwella Rubber

The Dipped Products Group (DPL), one of the world's top three non-medical rubber glove manufacturers, has unveiled plans to increase its local capacity with the acquisition of a 70 per cent stake in Hanwella Rubber Products Ltd.

DPL notified the Colombo Stock Exchange (CSE) that it had entered into a Memorandum of Understanding for this purpose with BAM Holdings, the major shareholder in Hanwella Rubber. The company plans to make a further investment in the production facilities of Hanwella Rubber, a manufacturer of disposable medical gloves, to convert its production lines to manufacture products for the DPL portfolio, DPL Managing Director N. G. Wickremeratne said.

This process, on completion, is expected to add about Rs. 600 million in value to DPL's business and increase capacity by nearly 20 per cent, he said. This acquisition will serve DPL's need for increased capacity on its current product portfolio, and will in the short term, help supply the company's smaller customers for medical gloves by adding to the production from DPL Thailand, the company's maiden venture into the medical gloves market, Wickremeratne said.

DPL would also use this facility to supply its own branded medical gloves to the domestic market, he said.

In 2005-06, Dipped Products and its subsidiaries comprising world class hand protection manufacturing companies and tea plantations reported a turnover of Rs. 7,109 million, up 16 per cent over 2004-05, with revenues from the Hand Protection sector growing 18 per cent and 10 per cent in the Plantation sector.