Alto Completes the Takeover

PRESS RELEASE – 3rd April 2006

Alto Completes the Takeover

The country’s largest plastics company will from today trade as Alto Holdings Limited.

This follows the successful takeover in May last year by Masthead Equities of the stock exchange listed plastics company Vertex Group Limited, which was subsequently integrated with the operations of Alto.

Alto’s managing director Mark Wheeler said that till now the two businesses had been operating under their own brands.

“That has now changed with the merger process now complete,” he said. “The decision to move from the Vertex name to Alto was primarily based around the bad press that Vertex received while a listed company. We were always going to trade under one name once we had blended the two plastics businesses together and therefore Alto was the logical choice.

“Certainly we are confident that both our customers and staff will be comfortable with the change. The new entity has a single strategy, significantly increased capacity, supports future investment in larger output and more efficient plant and also offers customers the choice of a wider product range”.

The new company name also involves a complete re-brand of both the Alto and Vertex businesses involving a new and more dynamic Alto logo. This will become evident as the brand is fully rolled out throughout April and May.

Alto Plastics Limited is a privately owned company with the main shareholders being Masthead Equities and Mark Wheeler.

Alto specialises in the manufacturing of rigid plastics products. Approximately 85% of its sales are in the Food and Non-Food Packaging business. In addition to this, the company manufactures industrial and technical products for a large number of businesses. Alto also has a significant investment in new product development and also runs a large and modern toolroom. It has eight manufacturing sites and three support offices in New Zealand as well as a sales office in Australia.

Mr. Wheeler said that the integration process had gone very well. “There is always uncertainty in such situations. But redundancy has not been a feature of this merger.”

“Synergies have been obtained through streamlining back office functions like IT, finance and procurement. In terms of the operations, however, we have grown the business.

Annual sales at the time of the merger were around $150 million. They now sit at $170 million with further growth anticipated. Staff numbers have grown to 840 during this period as the business expanded to meet excess capacity.

Mr Wheeler said that further consolidation was needed within the NZ market place to create a company of scale that creates a cost structure capable of withstanding increased competition through regionalisation/globalisation. The merging of Alto and Vertex was the first stage of this journey and plans are afoot for further consolidation.

Mr Wheeler said that one of the biggest threats facing the industry was that local manufacturers lack scale in the global market place and sometimes struggle to manufacture locally at competitive prices in the deregulated environment. “If we are not progressive in this regard, cheap imported goods will erode our manufacturing base,” he warned.

ENDS

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