Malaysian Tissue Paper Producer NTPM Sells Mill Assets

Malaysia’s leading tissue paper producer Nibong Tebal Paper Mill (NTPM) has sold a small mill to fellow Malaysian firm XSD International Paper for a cash consideration of Ringgit 27 million ($6.5 million).

The Bentong, Pahang state plant runs two tissue units that have a combined capacity of 10,000 mtpy.

“The mill incurred losses continuously, and we decided to dispose of the assets and use the proceeds to streamline our operations,” said NTPM’s executive director, Lee Chong Choon.

“Demand for tissue and personal care products from consumers increased rapidly for a few months after the outbreak of the COVID-19 pandemic in Malaysia and neighboring countries early this year.

“However, away-from-home demand has been hit hard by the fallout of COVID-19. In the end, we have just managed to maintain our business.”

NTPM has focused on expanding its other two facilities over the past two years.

The firm started up a 20,000-mtpy tissue machine, PM 22, at its flagship mill in Penang, Malaysia, in October 2018, taking the plant’s total capacity to 110,000 mtpy.

Besides PM 22, the Penang site operates 18 tissue units.

The company also commissioned two identical 20,000-mtpy tissue machines at its plant in Binh Duong, Vietnam, last year.

Including a 10,000-mtpy tissue unit that came on stream five years ago, the Vietnamese facility’s total capacity is now 50,000 mtpy.

The buyer of the Bentong mill, XSD International Paper, is an affiliate of China’s Zhejiang Xinshengda Holding Group (Zhejiang XSD). Li Shengfeng is the chairman of both companies.

XSD International Paper called the purchase a milestone, as its first takeover after expanding into Malaysia in 2018.

“This acquisition will help us grow and expand the potential of XSD International Paper both locally and internationally,” said Li.

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