JAKARTA (JP): Malaysian sugar tycoon Robert Kuok is moving in
JAKARTA (JP): Malaysian sugar tycoon Robert Kuok is moving in
a big way into Indonesia. Fresh from his sugar plantations joint
venture with Indonesia's richest man Liem Sioe Liong, he now
plans to plant enough oil palm in two joint ventures in
Kalimantan and Sumatra to cover an area with the size of
Singapore.
Liem -- who heads Indonesia's largest conglomerate, the Salim
group -- is again Kuok's partner in one of the two projects which
will be fully integrated, the Singapore-based Business Times
reported yesterday.
However, few details are available on this venture which is
said to be in Kalimantan.
While the Sumatran joint venture has not been identified, Kuok
is going in with Hasjim Djojohadikusumo, who runs listed cement
company PT Semen Cibinong. They have formed PT Sei Sungkai, 30
percent owned by Hashim and 70 percent by Kuok-controlled Perlis
Plantations Ltd which is listed on the Kuala Lumpur Stock
Exchange.
PT Sei Sungkai plans to invest some US$116 million in four
projects in South Sumatra -- two occupying 10,000 hectares each
and the other two 12,000 hectares each.
Of the total funds, $13 million will be for land, $51 million
for plantation development, $17 million for fixed assets, $27
million for a mill and the rest working capital.
PT Sei Sungkai, which will have a paid-up capital of $27
million, will fund the projects through a combination of
shareholders' advances ($17 million), cash from operations ($19
million) and loans ($53 million).
Plantation
It will plant 34,000 hectares of the 64,000 hectares with oil
palm, which when in full production in the year 200, will yield
848,000 tons of fresh fruit bunches, 178,000 tons of crude palm
oil and 42,300 tons of palm kernel.
The mill, which is expected to start operations in 1999 with
an initial capacity of 150,000 tons, will by 2006 be able to deal
with 900,000 fresh fruit bunches. While the Indonesian market for
palm oil is huge, some of the production is expected to be
exported, probably to China where Kuok has substantial dealings
in edible oils.
The Hashim joint venture will more than double Perlis
Plantations' oil palm acreage. As at April last year, Perlis
Plantations had developed 24,000 hectares of the 39,000 hectares
it owned in Sandakan in the East Malaysian state of Sabah and
Miri in Sarawak.
The diversified company, one of the largest listed on the KL
Stock Exchange, is 30 percent owned by Kuok, and is into sugar,
palm oil, mining and rubber, hotels, property development and
retail and cinema operations.
Group after-tax profit rose 16 percent to M$212.03 million
($78.77 million) for the year ended Dec. 1, 1993 while turnover
edged up 3.5 percent to M$3.45 billion. Pre-tax profit rose 14
percent to M$268.47 million.
Perlis Plantations, which was not available for comment on the
oil palm projects, has since told the stock exchange that while
it was involved in the planning stage for the seven sugar
projects in Sumatra with Liem and initially in the start-up of
the first project, the sugar operations were handled by Kuok's
private companies.
Business Times had earlier reported that Kuok and Liem, who
recently celebrated his 50th wedding anniversary at Kuok's
Shangri-La Hotel in Singapore, had merged their sugar interests
in Indonesia under a new holding company and planned to spend
more than $1 billion on seven projects covering a total area more
than twice the size of Singapore in South Sumatra.