KUALA LUMPUR: Supermax Corporation Bhd’s wholly-owned unit, Maxter Glove Manufacturing Sdn Bhd, has entered into a deal to acquire Leader Cable Industry Bhd’s land for RM65 million.
In a statement, Supermax said the 6.55-hectare freehold land with industrial premises is located in Meru, Klang.
“The proposed acquisition is for the future expansion of the group’s manufacturing capacity, as it is strategically located near Maxter’s existing cluster of manufacturing plants, which will facilitate management control, operational synergies and efficiency,” it said.
The natural rubber and nitrile gloves manufacturer said it plans to construct three large nitrile glove manufacturing plants on the land at an approximate cost of RM550 million over the next five years, which will increase the company’s production capacity to 42.6 billion pieces per year.
“The new plants will generate revenue growth as a result of increased operational efficiency derived from the new production lines,” it said.
The acquisition will enable the company to expand its manufacturing capacity, grow its business and ultimately accrue long term benefits to the shareholders, and will be funded through internally generated funds and bank borrowings.
Supermax added that the proposed acquisition will not have any effect on the share capital and substantial shareholder’s stake in the company nor will it affect earnings per share and net assets per share.