SINGAPORE (Reuters) - Thailand's Siam Cement Pcl's (SCG) SCC.BK packaging subsidiary is planning a local listing, in a float that is set to raise about $1 billion, two sources with knowledge of the matter said.

FILE PHOTO: The logo of the Siam Cement Public Company Limited is pictured at its office building in central Bangkok, Thailand, June 9, 2016. REUTERS/Chaiwat Subprasom

The IPO of SCG Packaging Pcl (SCG Packaging), which could be announced as early as this week, is aimed at independently beefing up the company’s funding needs as it charts out a regional expansion strategy, they said.

“Siam Cement has been considering options for this business and an IPO is the next step,” said one of the sources.

The sources declined to be identified as news of SCG Packaging’s IPO has not been publicly reported.

There was no response to emails sent to SCG Packaging.

SCG Packaging is the holding company for the packaging, packaging paper, forestry, pulp and paper business of the country’s largest industrial conglomerate.

The unit, 99% owned by SCG Packaging, is expected to file for an IPO in December and launch the issue in the first half of 2020, one of the sources said.

SCG Packaging’s planned IPO comes at a time of renewed investor interest in Thai IPOs, supported by growth expectations in the country and the potential for expansion in Southeast Asia.

SCG Packaging has enjoyed strong business growth in the last few years. In 2018, its revenue from sales rose 7% to 87 billion baht ($2.88 billion) and profit jumped 37% to 6 billon baht. These were the highest in nine years, according to SCG Packaging’s annual report.

In May, SCG acquired a 55% stake in Indonesian paper packaging company, PT Fajar Surya Wisesa Tbk from existing shareholders for $665 million.