Bioprogress acquires film casting lines
March, Cambridgeshire-based, BioProgress has purchased two complete film casting lines to be used for the production of 'dissolve-in-the-mouth' products.
March, Cambridgeshire-based, BioProgress has purchased two complete film casting lines to be used for the production of 'dissolve-in-the-mouth' products.
The film casting lines have been acquired from Valence Technology following the closure of the Valence production facility in Newtonabbey, Northern Ireland.
The acquisition will add significantly to the Company's existing production capacity for water soluble films.
The two lines, which are in virtually new condition, are currently being dismantled and will be shipped to BioProgress before the end of August 2004. These lines were not previously used for casting water soluble films but can easily, and at relatively low cost, be modified for this purpose. BioProgress expects the lines to be producing film by the first half of 2005.
Each of these new lines has around three times the film production capacity of the current film casting line situated at BioTec Films, BioProgress' wholly-owned subsidiary in Tampa, Florida USA. BioProgress purchased each complete line for US$225,000.
The current operational Tampa film line has capacity to generate annual revenues of around $10m of the 'dissolve-in-the-mouth' breath freshening and vitamin film products of the type that BioProgress currently supply, for example to Boots Retail in the UK and a number of corporates in the US. The two newly acquired lines are larger and have around three times the production capacity each of the current Tampa line.
When installed the new lines will increase the company's revenue generating capacity of 'in-the-mouth' dissolving films to around US$70m per year.
Commenting on the purchase Graham Hind, chief executive of BioProgress, said: 'This is an excellent purchase for BioProgress. The acquisition demonstrates the skill and quick-reactions of our operational and engineering team in identifying good opportunities to further our business. It also represents great value for our shareholders, securing two new film production lines for US$450,000 when one new purpose built line in the UK would normally cost in excess of £1m.
'We have now secured additional film production capability to take full advantage of the current global shortage of soluble film casting production capacity. This shortage is due to extremely strong global demand for 'dissolve-in-the mouth' products and the lack of both expertise and capacity to meet the demand.
This purchase will increase our presence in the 'dissolve-in-the-mouth' product market, provide us with the means to develop other target markets for this technology and will place BioProgress in a strong position going forward.'