Business

Tuesday August 18, 2009

Malacca-based firm to invest US$400mil in China


KUALA LUMPUR: Malacca-based electronic and electrical goods manufacturer, Cubic Integrated Group, will invest US$400mil to build its first overseas factory in Wanzhou in the Chongqing district of China.

Executive chairman Datuk Goh Seng Chong said the project was targeted to generate revenue of US$1.42bil in the first five years of operations.

The manufacturing hub will be built at the Wanzhou Industrial Park, which is located near the gigantic Three Gorges Dam on the Yangtze River.

“The investment is expected to occupy 0.86 sq km, (with) a total building area of 0.47 sq km and a planned built-up floor area of over 350,000 sq m,” Goh told reporters after signing an investment agreement with Wanzhou Industrial Park Administration Commission of Chongqing director Li Shiming yesterday.

Cubic Integrated Group executive chairman Datuk Goh Seng Chong (second right) exchanging document with the First Secretary of CPC Wanzhou Committee Chongqing Wu Zhenglong. Looking on is director of Wanzhou Industrial Park Administration Commission of Chongqing Li Shiming.

The event was witnessed by Malaysia External Trade Development (Matrade) chief executive officer Datuk Noharuddin Nordin and the First Secretary of Communist Party of China Wanzhou Committee Chongqing Wu Zhenglong.

Goh said the project would be funded by internal funds and through foreign investments.

“We expect 20% of the total investment to be internally generated and will raise funds through Malaysia, Singapore, Hong Kong and China investments,” he said, adding that it would also talk to US investors.

Noharuddin said Matrade was supportive of collaboration between the private sectors and strategic partners abroad to improve market entry and competitiveness through cost cutting initiatives.

“To facilitate Cubic to expand globally, we have introduced the company to International Islamic Trade Finance Corp, a member of the Islamic Development Bank, to explore financing opportunities,” he said.

Goh said the plant, to be completed in five years, would be the first manufacturing facility in the Wanzhou park. It would employ 25,000 people.

He added that Cubic was in the process of registering an investment holding company, Cubic Integrated Group Wanzhou, for its China operations.

“The holding company will be responsible for the entire operations of the Cubic manufacturing hub in Wanzhou. We will try to get this done by end of the year,” he said, adding that the Wanzhou factory would mainly focus on electrical and electronics home appliances such as coffee makers, blenders, LCD TVs, vacuum cleaners and hair dryers.

The China plant will cater to both local demand and exports.

Set up in April 1994, Cubic has a 1.3 million sq ft factory in Ayer Keroh, Malacca. It also has businesses in the property and education sectors.

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