Sinar Mas to use Amcol to expand

Sinar Mas to use Amcol to expand

SINGAPORE (Reuter): Indonesian conglomerate Sinar Mas Group aims to use Singapore-based Amcol Holdings to spearhead its regional expansion into the food, palm oil and property sector, a company official said yesterday.

"Amcol is only an opportunity for us in achieving our strategy...we would like to grow globally," Sinar Mas managing director Indra Widjaja said.

He was speaking to reporters after the signing of a joint venture agreement with CISCO, a company that provides security services, in Singapore.

He said the troubled property and trading-based Amcol, which Sinar Mas took over in August, was an ideal vehicle for the group's regional plans in the food and palm oil business.

"As a listed company...(it has) easier access to the capital market. If you want to expand regionally you need a lot of capital," he said.

Amcol would look to invest in regional countries such as China and India where other divisions of the Sinar Mas Group already had a presence, he said.

Sinar Mas is injecting assets worth more than US$2 billion into Amcol which was put under judicial management in July after a Price Waterhouse report said the company had serious cashflow problems and difficulties meeting its financial obligations.

"We have in mind... (injecting) property, food industry, palm oil downstream products," Widjaja told reporters.

The Sinar Mas group has four main divisions; paper and pulp under Asia Pulp & Paper, finance under Bank International Indonesia, palm oil and property.

He said the last two divisions would be put under Amcol and the group would "try to expand more regionally especially in the food industry and downstream products of palm oil".

To this end, a noodle factory in China, which has about 20 percent of the market share, would also come under Amcol.

Widjaja said the group also hoped to convert the listing of Amcol shares to be denominated in Singapore dollars instead of U.S. dollars.

"If there is a possibility of course we prefer to be in Singapore dollars," he said.