BGF buys KBF, which makes better type of plasticBGF acquired eco-friendly plastic manufacturer KBF through its subsidiary BGF ecobio, the conglomerate announced Wednesday.
BGF said it was responding to growing awareness about the irresponsible use of plastics among consumers. The announcement was made on International Plastic Bag Free Day, which marks its 11th anniversary this year.
BGF controls BGF Retail, which operates the convenience store chain CU.
BGF ecobio bought a 77.01-percent stake in KBF. BGF owns 83.3 percent of BGF ecobio.
KBF, based in Hwaseong, Gyeonggi, is the only Korean company that manufactures biodegradable foam plastics, according to BGF. It has seven patents on a foam that totally degrades within six months and without a separate recycling process.
Whether materials developed and manufactured by KBF will be used for packaging of goods sold at CU hasn’t been decided, according to a spokesperson for BGF.
“KBF is a very small company so it currently lacks facilities [for production],” the spokesperson said. “So the top priority is to work on building a factory and strengthening its production capacity. Through KBF, BGF plans to develop packaging for products like ramen and insulated cups that take away the need to use hot cup sleeves.”
The spokesperson added, “BGF plans to supply the materials to other companies and is considering entering foreign markets.”
BGF said it plans to adopt automation equipment for its eco-friendly plastics production if demand grows in the future.
“The eco-friendly materials industry is a highly attractive one and its market has grown globally every year,” said Lee Keon-jun, president of BGF. “[BGF] plans to develop the ecobio market as part of the group’s effort to create social value and turn it into our new growth engine.”
Kim Kyung-chung, who previously was executive vice president of SPC Group and Kangwon Land, has been appointed president of KBF. Kim Jin-woo, the former head of KBF, will remain at the company as CTO and be responsible for the development of new products and technologies.
BGF ecobio, which was established in June, is headed by Hong Jung-hyuk. Hong is the second son of BGF CEO Hong Seok-joh.
“The ecobio market isn’t expected to create a synergy effect with BGF’s existing businesses,” said an industry source. “The acquisition reflects the group’s effort to create a new growth engine.”
BY JIN MIN-JI [firstname.lastname@example.org]
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