January 27, 2004

 

 

Malaysia's Pin-Wee To Strengthen Poultry Leadership Thru Acquisition

 

PIN-WEE Group Bhd, an integrated poultry breeder and supplier, has acquired 60% stake each in Di-Hin Farm Sdn Bhd and Evergreen Breeding Farm Sdn Bhd, strengthening its position as the largest broiler producer in the northern region of Malaysia and one of the largest in the country. 

 

Its businesses involve a range of activities such as poultry nutrients agency, feeds manufacturing, breeding of broiler chicks, broiler farming and slaughtering and processing of poultry meat.

 

Group executive chairman Siah Gim Eng said the acquisitions, completed yesterday, integrated well with the group's strategy to expand its broiler supplies while further improving the bottom line. 

 

Pin-Wee paid RM10mil for the stakes in Di-Hin and Evergreen, which are involved in broiler and breeder farming respectively. 

 

"The group's ability to produce day-old chicks will be doubled with the acquisition of Evergreen," Siah said. "This will enable us to obtain cost synergies that will lower the cost of production and increase the stability and quality of profit." 

 

He said that in view of the recent acquisitions and greater market demand for broiler feed, and the expansion of its broiler farming operations, the group had decided to increase the production capacity of its existing feedmill plant at Bukit Minyak. 

 

"We are allocating RM4.5mil to add another line to expand production capacity from the present 20 tonnes per hour to 48 tonnes per hour. The new production line should be installed by the fourth quarter of 2004," he said. 

 

Siah also said the group was planning to use a 3.5-acre property in Bukit Minyak, acquired last year, to establish a modern food processing plant to produce value-added meat products, such as nuggets, frankfurters, sausages, and others. 

 

"We are looking into producing our own brand of value-added processed chicken meat. Our objective is to enable Pin-Wee to generate revenue from related business activities and opportunities," he said. 

 

Pin-Wee is in the process of expanding the production capacity of its chicken processing plant, Pin-Wee Food Industries (KL) Sdn Bhd, in Selayang. The expansion will also include the production of value-added food items. 

 

Siah said there were also plans for layer farming, which had tremendous synergy with the group's set-up and could contribute significantly to its bottom line. 

 

"Our group corporate philosophy is focused on continuous improvement in products and services and the bottom line by controlling overheads diligently.

 

"This guideline has helped Pin-Wee overcome many challenges during the economic downturn and has successfully guided the group to attain its present status in the broiler farming business in the country," he said. 

 

Pin-Wee is scheduled for a transfer to the MSEB main board tomorrow.  

 

For the main board transfer, Pin-Wee has made a bonus issue of 12,182,250 new shares on the basis of one share for every four shares held. 

 

For the nine months ended Sept 30, 2003, Pin Wee generated RM111.01mil in revenue and RM8.81mil in pre-tax profit.