Dipped Products PLC (DPL) has finalized arrangements for the acquisition of land in Thailand for its first medical glove factory and that its subsidiary KVPL had entered into a strategic alliance with Mabroc Teas (Pvt) Ltd., for the manufacture and marketing of tea.

In announcements to the Colombo Stock Exchange (CSE), the company said it had entered into an agreement to purchase nearly 12 acres (30 Ral) of land in Hat Yai in the rubber growing Songkhla Province of Southern Thailand for its US$ 7 million medical glove venture.

The sale agreement was entered into on August 3 by N. G. Wickremeratne, Managing Director of Dipped Products PLC who headed a four-member team from the company to Thailand.

Wickremeratne said that Securing suitable land for glove manufacturing facilities which require large amounts of water is a time consuming process. "We had inspected more than 50 sites in the area. The Board of Investment of Thailand has approved the purchase of the site by Dipped Products (Thailand) Limited, the new company incorporated to undertake the project."

He said that they are also finalizing contracts for the construction of buildings, main dipping machinery and other equipment and hope to be in operation by June 2004.

"This is the first overseas manufacturing facility of the DPL Group and it is expected to greatly add synergies to DPL’s distribution company ICO Guanti Spa of Italy, acquired in May 2002. The medical glove project is expected to generate annual revenue of more than US$ 10 million" he said.

In a second major announcement, DPL said its plantation subsidiary Kelani Valley Plantations Limited (KVPL) would take a 10 per cent stake in Mabroc Teas, and that existing shareholders of Mabroc Teas would acquire shares in KVPL. The two companies in the strategic alliance are contemplating setting up several targeted tea manufacturing and marketing projects.

Mabroc Teas has been in operation for 15 years and is among the top 20 tea exporters from Sri Lanka. A company focused on value added and packeted teas, Mabroc exports more than four million kilograms of tea to 27 countries, generating annual sales of nearly a billion rupees. The company’s major markets are in the CIS, the Baltic States, Middle East and Japan where it has its own branded products and UK, USA and Australia.