Heng Huat buys Sabut Kelapa Terengganu for RM200,000

KUALA LUMPUR: Heng Huat Resources Group Bhd is buying into 97 per cent stake in Sabut Kelapa Terengganu Sdn Bhd (SKT) for RM200,000.

In a statement today, Heng Huat managing director Datuk H’ng Choon Seng said the SKT acquisition will strengthen Heng Huat’s position as a regional player in the biomass industry.

SKT’s plant has a production capacity of 150 tonnes/month and 240tonnes/month for its coconut fibre and coco peat, respectively.

Last year, SKT incurred a net loss of RM728,839.

Despite buying into a loss-making entity, H’ng views the SKT purchase to contribute positively to Heng Huat’s net assets per share, this year.

He explained the factory location, which is in Setiu, Terengganu would ensure a huge amount and constant supply of raw materials such as coconut husks at a cost-effective price.

“The transportation cost will be reduced significantly as the distance to the factory is much shorter,” he added.

Source: NST