Wednesday November 24, 2004 - FRESH from making inroads into China,Ecofuture Bhd is eyeing the Middle East as the next major market for itsEcomat, a fibrous mat made from oil palm residue for use in soil erosionprevention and in combating desert and sand storms.
Ecofuture chief executive officer Yeo Kim Luang said the company, whichwas involved in oil palm biomass, milling and sale of crude palm oil andkernel, made inroads into China using Ecomat in a desert and sand stormscontrol trial project in Beijing two years ago.
She said the company had in April entered into a four-year agreement worthRM3mil to extend the project to other parts of China.
Yeo said two countries in the Middle East, Kuwait and Lebanon, was alsotrying Ecomat for desert storm control.
Kuwait has been at the trial stage for the past one year, and the resultsare positive.
We are looking forward to them placing an order by early next year, shesaid after an underwriting agreement signing with Affin Merchant Bank Bhdin Kuala Lumpur yesterday in conjunction with Ecofuture's listing on theMesdaq market.
Affin Merchant is the adviser, sponsor, sole placement agent and soleunderwriter for Ecofuture's listing.
Yeo Kim LuangYeo said the potential market for Kuwait was substantial, estimated to bearound RM100mil.
She said, the company was also eyeing Taiwan, Japan and South Korea.
For the listing exercise, Yeo said, Ecofuture was looking to raising aboutRM10.9mil, of which RM5.6mil would be spent on construction of a newfactory for biomass operations and purchase of plant and machinery.
Another RM1.6mil would be spent on installation of boilers and turbines,RM800,000 on research and development, RM700,000 on expansion of existingbiomass operations, RM350,000 on working capital for biomass operations,and RM1.8mil on listing expenses.
She said the company was offering 43.635 million new ordinary shares of 10sen each at an issue price of 25 sen.
Of the total, 20.945 million shares will be made available for privateplacement to selected investors and institutional investors, 11.963million for the public, and 10.277 million for eligible directors andemployees.
She said Ecofuture planned to set up the new factory for biomassoperations at its manufacturing plant in Segamat, Johor, by early nextyear.
“The new building is expected to increase our capacity by 50%,” she said,adding that its production line would be increased from two lines tothree, and daily production from 10,000 sq metres to 15,000 sq metres.
For the financial year ended Dec 31, 2003, the company posted a net profitof over RM1mil on revenue of between RM4mil and RM5mil.