December 13, 2007

Japanese firm buys stake in Malaysia's largest soy crusher

AmPrivate Equity Sdn Bhd and Mayban-JAIC Management Ltd have jointly acquired 27 percent of Soon Soon Oilmills Sdn Bhd, Malaysia's largest soy crusher, via an issuance of new shares.  

Japan Asia Investment Co (JAIC) is understood to take a 15-percent stake in the company.

AmBank group managing director Cheah Tek Kuang told Malaysian newspaper The Star that the injection of fresh capital together with board representation marked an important milestone for Soon Soon Oilmills.  

With the entry of new investors, Soon Soon Oilmills will enjoy the benefits of wider reach and new markets through both investors' presence across Asia, including Japan, where JAIC's strong network and resources can be leveraged, Cheah told the newspaper.  

Soon Soon managing director Datuk Dr Neoh Soon Bin said the company hoped to commercialise a new range of solutions for the food and feed industry.    

Soon Soon engaged AmInvest Bank group as adviser, which identified AmPrivate Equity and Mayban-JAIC as strategic partners to invest in the company.

Neoh said the company was five years away from its goal towards becoming a public listed company and had yet to decide which board to be listed on.  

However, he revealed that the company is considering a country outside Malaysia and its location would be dependant on where the company's products would be marketed in the long term.

He said that if the company were to market in Japan, the Japan Stock Exchange would be a natural choice but for now Malaysia would be the preferred choice. It was understood that JAIC, the investment firm will help the Malaysian company build sales channels in Japan.

News sources say the company would aim to go public in three years, and is eyeing a possible listing on the Tokyo Stock Exchange.

Soon Soon Oilmills, with annual sales of about RM600mil (US$181.2 million), exports 30 percent of its products, the Star reported. 

The company is a part of Soon Soon Group, a grain, oilseed and oil-processor with two factories in the country. The company is also involved in oil refining, corn milling, soy protein and the production of specialty oils and fats.

The firm is now intensifying research to diversify operations and will use the capital to strengthen its management.