KUALA LUMPUR: Tien Wah Press Holdings Bhd plans to close its 57-year-old printing business in Petaling Jaya under its wholly-owned subsidiary Tien Wah Press (Malaya) Sdn Bhd (TWPM).
It told Bursa Malaysia in a filing that this followed the closure of the Petaling Jaya factory of its major customer, British American Tobacco Group.
Tien Wah will now shift printing done here to its factories in Vietnam and Indonesia. The company said 237 employees would be made redundant.
News of this latest closure comes on the heels of the planned closure of two major factories in Penang.
It was reported on July 15 that hard disk maker Seagate Technology Plc and computer data storage firm Western Digital Corp (WD) planned to relocate the bulk of their operations to Thailand.
Seagate is expected to close its plants in Penang and Negri Sembilan, affecting more than 3,000 Malaysian staff. WD is expected to lay off 400 Malaysian staff and 800 foreign workers from its Penang manufacturing site.
Tien Wah told Bursa Malaysia: “Following the cessation of its major customer’s operation in Malaysia and [its] subsequent shifts in production facilities to Singapore, Korea and Indonesia, the group acknowledged that there is no requirement for duplication of a printing base in Malaysia.
“Hence, [the group] had initiated transfers of its majority production volumes from TWPM to Vietnam and Indonesia to improve its strategic position to service the customer and reduce the group’s operating cost over the longer term.
“The board is of the view that the re-organisation of its production footprint which involves the cessation of TWPM’s printing business is therefore timely.”
TWPM constitutes about 13.6% of Tien Wah’s latest audited net assets of the group as at Dec 31, 2016.
TWPM specialises in printing cigarette cartons and consumer goods packaging, cartons, labels packaging and advertising materials.
In March last year, British American Tobacco announced it would close its factory by the second half of this year following a difficult business environment. It said it would lay off 230 workers.