Southern Packaging stock surges on possible land sale
Rocketing land prices in China may land the company with a windfall on factory land says COO Pu Jinbo.
SOUTHERN PACKAGING’s share price rocketed into action this month as the market caught on to the possibility of the company - in which Singapore popiah king Sam Goi has a stake - unlocking the land value of its Nanhai factory.
The company is negotiating an asset restructure that could possibly result in the exchange of its Nanhai factory land for land space of up to 5 times the size in non-core central districts, said COO Pu Jinbo in a telephone interview with NextInsight.
From illiquid trades at the 12.5-15-cent range on volume of no more than 46,000 shares for the entire month of April, Southern Packaging shares suddenly closed a third higher at 20 cents on 2 May.
For the past seven trading days this month, the stock held steady at around 25 cents, with average volume exceeding 2 million shares daily.
Shortly after its stock price began running, the company made an official statement revealing that CEO Pan Shun Ming had agreed to sell his privately-owned land parcels situated next to Southern Packaging’s Nanhai factory.
Mr Pan’s agreement with the acquiring parties included a clause requiring him to procure for them the land on which Southern Packaging’s Nanhai factory is situated.
Negotiations are likely to take another two months, figured Mr Pu.
The maker of printed plastic bottles and bags for global fast moving consumer goods manufacturers completed a new factory in Shanghai just last month.
Costing Rmb 15 million, the Shanghai factory has capacity to produce 100 million PET bottles a year.
It is equipped with 13 production lines and occupies 5,450 sq meters.
For more on Southern Packaging, read:
SOUTHERN PACKAGING: FY07 net profit soars 46% to S$6.7m
SOUTHERN PACKAGING wows global clients with top-tier facilities
SOUTHERN PACKAGING and the Sam Goi-Super Coffeemix connection