Production boost for Evergreen

Executive director Kuo Jen Chiu said the company's overall earnings were forecast to rise by 45% following the completion of the latest line, which cost between RM30mil and RM40mil.

The two lines would generate revenue of RM250mil in 2007, he told reporters after Evergreen Fibreboard signed an underwriting agreement in Kuala Lumpur yesterday for its proposed listing on the Bursa Malaysia mainboard.

Kuo said its Thai fibreboard plant had a current capacity of 160,000 cu m per annum, and the second production line would double that.

"In future, the Thai plant's production capacity will exceed Malaysia's MDF production of 240,000 cu m per annum." he said, adding that the MDF produced there would be solely for the Thai market.

To cater for the rising global demand for MDF (a material largely used in the production of furniture, women's shoes and motor vehicles), Evergreen plans to set up a RM3mil chipping plant in Indonesia.

Kuo said existing rubber trees in Malaysia, amounting to nearly 1.3million ha were adequate to meet the current production demand for MDF.

As part of the company's listing exercise, Evergreen is offering 93.66 million new shares if 25sen each for the public issue.

Speaking at the signing ceremony, Aseambankers Malaysia Bhd deputy chief executive T. Jeyaratnam said the resurgence of interest in initial public offerings (IPOs) was evident, as seen in the oversubscription rates.

"The recent IPOs on the main board of Bursa Malaysia have enjoyed oversubscription rates of up to 18 times. Based on these very encouraging signals coupled with Evergreen's position as the leading integrated producer of engineered wood-based panel products we are confident that Evergreen's IPO will be well received." he said.

The company plans to raise RM106mil when it is listed by the middle of next month. - Bernama