Branta to expand business in ASEAN

JAKARTA (JP): PT Branta Mulia, a yarn and tire cord manufacturer listed on the Jakarta and Surabaya stock exchanges, will expand its business network in Southeast Asia through a joint venture agreement with several Malaysian companies to construct a third tire cord plant.

"We are setting up a tire cord plant in Malaysia and expect to start production in 1996." Ibrahim Risjad, president of PT Branta Mulia, said after the company's annual and extraordinary shareholders meetings here yesterday.

Ibrahim told reporters that the company will invest US$55 million, accounting for 40 percent of the total investment for the new plant. The remaining 60 percent will be put up by Malaysian firms.

Ibrahim said the new plant will be the third tire cord plant of PT Branta Mulia in the ASEAN region after the first and second factories in Indonesia and Thailand.

Ibrahim added that due to technology requirements, the company will also develop its tire materials by setting up a tire polyester yarn plant here.

"We are investing US$ 60 million for the tire polyester yarn plant," Ibrahim said, adding that the plant is expected to be completed in 1996.

Ibrahim said the construction of the two new plants will be financed by the company's retained profits and fresh funds to be raised through a rights share issue.

He said the two tire cord plants are expected to produce 33,000 tons this year, 21,000 tons of which are expected from the plant in Bogor, West Java.

In addition, he said, the Indonesian plant will produce 20,000 tons of nylon-66 yarn this year, up from 16,000 tons last year.

The shareholders yesterday agreed to distribute a cash dividend of Rp 80 (4 US cents) per share by the end of July.

The company's net profits last year dropped to Rp 35.15 billion (US$16.29 million) from Rp 46.49 billion in 1992. (02)