July 13, 2012

Japan's Itochu acquires 25% share of Malaysia's Agromate Holdings

About 25% share of Agromate Holdings, one of the largest fertiliser distributors in Malaysia, has been agreed to be acquired by Japan's Itochu Corporation.

Agromate was founded in 1970. Since then, the company has grown to having total nine distribution centres of which seven in Malaysia and two in Indonesia. The company handles 1.3 million tonnes of fertilisers annually and furthermore, it owns a manufacturing company in the state of Sabah, Malaysia which has a manufacturing capacity of 200,000 tonnes of NPK compound fertilisers per year, which is one of the largest in Asia.

In midst of global population increase, it is predicted that the need for fertiliser will grow reflecting the need for food, especially in Asia, where a high economic growth and increasing income level are strongly expected.

The agreement was reached when Agromate's desire to utilise ITOCHU's network in order to expand its supply source matched ITOCHU's intention to expand its fertiliser business in Asia.

Fertiliser resource is predicted to become tight in the medium and long term. ITOCHU is aiming to put its resource to collaborate with Agromate to promote new investment in this fertiliser resource industry to build solid business foundation with its main focus in Asia.