Evergreen expanding ops

 

BATU PAHAT: Evergreen Fibreboard Bhd is expanding its operations by setting up new manufacturing facilities and acquiring existing fibreboard makers. 

Executive director Kuo Jen Chiu said the expansion would further strengthen the company's position as one of Asia's top five producers of fibreboard. 

He said it was important for Evergreen to maintain its lead in the industry in view of competition from rivals in Indonesia and Thailand. 

"Local fibreboard companies need to be few steps ahead of their rivals if Malaysia wants to remain among the top exporters in the world," Kuo told StarBiz recently. 

He said Malaysia was currently the third largest exporter of fibreboard after Germany and Canada. 

 

Kuo said Malaysia could become the number one exporter if the country had more plants producing fibreboard. 

He said Evergreen had proposed to acquire Takeuchi MDF Sdn Bhd through its wholly owned unit Evergreen Fibreboard (JB) Sdn Bhd. 

Kuo said the company would acquire the fibreboard plant and other properties from Takeuchi for RM107mil and also Takeuchi's contracts with its customers and suppliers. 

An EGM would be held next month to get shareholders' approval on the proposed acquisition, he added. 

"The acquisition will increase our production capacity to 700,000 cu m per year from 600,000 cu m now," said Kuo. The group annually produces 280,000 cu m and 320,000 cu m at its Batu Pahat and Haatyai plants respectively. 

Takeuchi's 15-year-old Permas Jaya plant was the first fibreboard plant in Malaysia. It produces 100,000 cu m per annum, of which 70% is exported. 

 

Kuo said the target was to increase production to one million cu m annually in three years.  

He said Evergreen would also invest between RM120mil and RM150mil on a third line at its Haadyai plant, thereby increasing its capacity to 570,000 cu m yearly. 

"The expansion programme is part of our strategy to become a leading fully integrated fibreboard maker in the region," said Kuo.