Daiken cleared to buy MDF manufacturer Dongwha

Daiken Corp approved to buy MDF manufacturer Dongwha plant, (pictured) which is on State Highway...
Daiken Corp approved to buy MDF manufacturer Dongwha plant, (pictured) which is on State Highway 1 south of Mataura. Photo: ODT Files
The Overseas Investment Office (OIO) has granted consent for Japanese company Daiken Corp to buy the Southland-based MDF manufacturer Dongwha, south of Mataura.

The OIO decision last week did not disclose how much the deal was worth.

Daiken was in April cleared by the Commerce Commission to buy the Dongwha MDF (medium-density fibreboard) plant, saying it was satisfied the business merger would not substantially lessen competition in the construction materials supply market.

Korean-owned Dongwha was 80% owned by Dongwha International Co, a Hong Kong incorporated company, and 20% by Laminex Group, a division of listed Fletcher Building.

Fletcher is in the  process of selling several non-core assets, after mounting accumulated and expected losses of $952 million from one construction division.

Daiken’s parent company, Daiken Corp, is a Japanese company specialising in the manufacture and supply of wood-based construction materials. Its New Zealand subsidiary produces only MDF.

Laminex had bought MDF from Dongwha for its own New Zealand wood products business and also on-sold some of the MDF to other parties.

simon.hartley@odt.co.nz

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