UFS to invest $45 in new Kalimantan plant

United Fiber System (UFS) Ltd., a Singapore listed forestry-based company, announced on Thursday that its local unit PT Mangium Anugerah Lestari (MAL) would invest US$45 million in a new plant in Kota Baru, South Kalimantan.

In a statement, UFS chief executive Kishore Dass said the plant would have a capacity to produce 700,000 tons of wood powder annually. The powder would be sold internationally at a price of $120 per ton.

The plant is expected to be constructed within 12 months.

UFS has recently announced its plan to acquire the entire stake in troubled pulp and paper company PT Kiani Kertas from Prabowo Subianto, the former son-in-law of former President Soeharto.

The deal, which is currently being arranged by Deutsch Bank AG, is expected to be worth more than $200 million.

According to a report from the Center for International Forestry Research (CIFOR), local businessman Wisanggeni Lauw, was known to be the former largest individual shareholder in UFS by indirect means.

Wisanggeni is known to have a long-standing relationship with Probosutedjo, Soeharto's half brother. In 1994, Wisanggeni began working with Probosutedjo as the director of forestry based- company PT Menara Hutan Buana. -- JP