TOKYO -- Building materials maker Daiken Corp. will acquire Dongwha New Zealand at the end of December, the company announced Tuesday, in an effort to expand its sales of medium-density fiberboard.
The size of the deal has not been announced, but it is thought to be around 10 billion yen ($89.7 million).
Both companies produce medium-density fiberboard, a material often used in housing construction. Daiken already has production centers in New Zealand and Malaysia and is hoping to expand operations through Dongwha's sales networks in Oceania and North America.
Through its local subsidiary, Daiken will acquire all of Dongwha's shares from the Hong Kong-based parent company and other minority stockholders. Dongwha's sales were 91.59 million New Zealand dollars ($67 million) for the fiscal year ended December.
Plywood is the more commonly used material in Japan, but Daiken is trying to promote MDF, which is highly durable. "This is just a first step toward expanding MDF operations," said Masanori Okuda, president of Daiken. "We will continue to actively invest if there are good deals going forward."