Rs 1.8 billion polyethylene plant to be set up at PQA: finance agreement signed

Term finance facility of Rs 1800 million by Faysal Bank Ltd and National Bank of Pakistan to finance Pakistan's first Bi-axially Oriented Poly Ethylene Terephthelate (BOPET) plant, first of its kind in Pakistan, was announced at a signing ceremony held at a local hotel on Monday.
Total cost of the project is Rs 3.38 billion, out of which Rs 1.8 billion has been arranged through bank financing. The plant is expected to go into production by March 2012 at Port Qasim. The manufacturers of the plant are Brueckner of Germany.
The plant is being set up by Astro Plastics (Pvt) Ltd, an associate company of Ismail Industries Ltd (manufacturers of Candyland, Bisconni, Snackcity and Astropack). The lead advisors and arrangers of the financing agreement are National Bank of Pakistan and Faysal Bank which is also the agent bank and security trustee of the agreement.
Maqsood Ismail, Director of Astro Plastics, signed the agreement on behalf of the company, while Noman Ansari, Head of Corporate Banking of Faysal Bank and Iqbal Ashraf, Head of Corporate Banking of National Bank of Pakistan represented their respective banks. Dr Miftah Ismail, CEO of Astro Plastics (Pvt) Ltd, speaking on the occasion said that BOPET is more commonly known as polyester film. The application of this film is wide ranging, from packaging for edible products, as lidding for fresh or frozen meals, in manufacturing of zari, sequins, etc. As a packaging material, BOPET has high tensile strength, good chemical stability, good gas and aroma barrier and superior transparency and reflectivity.
Establishment of BOPET plant will result in technology transfer to the country and will enhance the packaging capabilities of local manufacturers. Estimates suggest that this project will save $40 million per year in foreign exchange through import substitution. In addition, potential for export earnings of up to Rs one billion per annum is also being foreseen. It will also generate tax revenues of Rs one billion for national exchequer. The project is expected to provide direct employment to 500 people and indirect employment to 2,500 people.