KUALA LUMPUR, Feb 7 — Hong Seng Consolidated Bhd has today accepted a letter of intent (LOI) from Mitsui & Co (Malaysia) Sdn Bhd to form a strategic partnership for Hong Seng’s nitrile butadiene latex (NBL) business at Kedah Rubber City and integrated logistics services business at Penang.
In a filing with Bursa Malaysia today, Hong Seng said under the LOI, Mitsui, a subsidiary of Mitsui & Co Ltd, a global trading and investment company headquartered in Japan, expressed its intention to provide a one-stop supply chain management for feedstock and raw materials of Hong Seng’s NBL plant.
It will also finance and provide raw materials for the tank farm established by Hong Seng’s fully-owned subsidiary HS Petchem Sdn Bhd.
“The LOI will create a mutually exclusive relationship between the parties in order to facilitate direct negotiations for the strategic partnerships.
“The strategic partnerships will further strengthen Mitsui’s market in Malaysia and Hong Seng to leverage on the expertise and global network of Mitsui in the chemical supply industry,” it added.
It said the LOI was valid for six months from the date of the LOI and thereafter will be automatically renewed for a further period of one year unless terminated earlier by either party.
In a statement, Hong Seng group managing director Datuk Seri Teoh Hai Hin said the company was proud to be a part of Prime Minister Datuk Seri Ismail Sabri Yaakob’s far-sighted vision of Keluarga Malaysia with this national project in Kedah Rubber City which is expected to contribute RM14.7 billion to the country’s gross domestic product (GDP) and create 14,500 spillover jobs at various levels within 15 years once it is completed by 2030.
“We will be developing our RM3 billion NBL project, which is poised to position Hong Seng as the first public-listed and large-scale nitrile raw material producer in Malaysia.
“Thus, the strategic partnership that we will form with Mitsui will enable us to leverage on the expertise and global network of Mitsui in the chemical supply industry, while helping to strengthen Mitsui’s market in Malaysia,” he said. — Bernama