Malindo Feedmill to spend Rp 245b on buyout and plant construction

The Jakarta Post, Jakarta

Public poultry products company PT Malindo Feedmill has allocated up to Rp 245 billion to acquire an affiliated company, PT Leong Ayamsatu Primadona (LAP), and to build a new poultry food plant next year, says an executive.

Malindo Commissioner Tan Lai Kang said here on Thursday that the acquisition would be worth Rp 145 billion, while the new plant would cost his company as much Rp 100 billion to build.

The acquisition and new plant were aimed at increasing Malindo's market share in day-old chicks (DOC), and to expand the company's sales in Central Java and North Sumatra provinces, he said.

Lai Kang said that his company, which is owned by Malaysia-based Dragon Amity Ltd. (76.6 percent) and the public (23.4 percent), would hold a shareholders' extraordinary meeting on Jan. 14, 2008 to get approval for the acquisition plan.

According to Lai Kang, LAP, which was established in 1997, had 13 farms for commercial chickens (fryers) and 7 farms for DOCs in Subang, West Java and Deli Serdang, North Sumatra. Its farms produce 6 million chickens and 62 million DOCs a year, respectively.

"The new plant is expected to be ready for operation in 2009 with 360,000 metric tons annual capacity," said Lai Kang, adding that the plant would be located in Modern Cikande in Serang, Banten.

Malindo's net sales increased by 16 percent to Rp 745.56 billion in the first nine months of this year, from Rp 642.39 billion in the same period of last year.

Meanwhile, its net profit decreased by 55.4 percent to Rp 19.37 billion in the first nine months of this year, from Rp 30.12 billion in the same period of last year.

Lai Kang said that the company was expecting to meet Rp 1 trillion of net sales by end of this year. (nkn)