PICOP boosts capital stocks, plans Indonesia, Malaysia projects

PICOP boosts capital stocks, plans Indonesia, Malaysia projects

MANILA (AFP): Newly-privatized Paper Industries Corp. of the Philippines (PICOP) said it was boosting its capital stock by 361 percent to 6.1 billion pesos (US$214.28 million) and was planning projects in Indonesia and Malaysia.

PICOP, one of the largest integrated wood-based groups in Southeast Asia and the largest paper and timber product producer in the country, is controlled by a consortium involving Filipino and Singaporean investors.

The consortium acquired 72 percent PICOP from the government for$ 86.23 million in February.

PICOP converted 2.5 billion pesos of mortgage bonds, part of its total liability of 4.5 billion pesos, into equity to enable the company to retool its plywood mills, modernize its paper mills and boost production of its southern Philippine operations.

Chairman Eduardo Arroyo told reporters after a stockholders meeting late Tuesday it was planning to set up an 800 million peso processing plant this year to make use of the vast forests of Indonesia and Malaysia.

The company will also enter into a joint management contract, in which PICOP will provide the technology to manufacture higher value paper and timber products, he added.

He would not name the company's would-be partners and did not say where the processing plant would be set up.

"We feel now that there will be strong regional trade in the area," he said, citing President Fidel Ramos's promotion of an East Asian Growth Area to promote increased economic ties with contiguous areas of Brunei, Indonesia, Malaysia and the Philippines.

"Joint venture agreements will be profitable," Arroyo said.