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AMG Packaging acquires Retirement Crescent property

Business reporter

Friday, September 21, 2018

AMG Packaging & Paper Company Ltd has acquired a property at 12 Retirement Crescent, Kingston 5.

The property was the home of Action Chemical and Equipment, a manufacturer of specialty chemicals for more than 20 years.

AMG's decision to acquire additional property comes months after the company offloaded the loss-making toilet paper business. For the nine months ended May 31, the company booked $34.3 million in disposal of the business, resulting in a decline of 41.3 million or 44 per cent in total comprehensive losses year over year.

But before that, AMG promised shareholders that it was working to strengthen its core box-making operation before the end of 2018. It's not clear what the company will be using the new premises for, as efforts made by the Jamaica Observer to get a response from Managing Director Michael Chin were unsuccessful up to press time.

However, the acquisition could be a part of plans by the company to go back to market next year to raise funds for expansion.

AMG Packaging and Paper got started in toilet paper business with Tishoo back in 2015 after it invested in a factory at Orange Street in downtown Kingston. The company planned on capturing at least 10 per cent of the tissue market in Jamaica, but had its sales set back when fire destroyed the warehouse of its distributor.

The box manufacturer then added Plush and Cottony to the product range and revamped distribution of the products, but continued to see sluggish sales because of imports from Trinidad and the United States.

With focus on its box manufacturing operation now, AMG announced in July that it would be increasing the price of its products as it struggles to keep up with increases in the cost of paper to manufacture its products. The company closed the nine-month period under review with total assets of $723.9 million, $86 million above the $637 million it posted a year earlier.