ML Global Berhad (“MGB” or “Company”) wishes to inform that the Company, has on 17 July 2017, signed a Memorandum of Understanding (“MOU”) with Sany Construction Industry Development (M) Sdn Bhd (“SANY (M)”) in relation to the setting up of a joint venture entity (“Newco”) for business of manufacturing of IBS precast products for building projects.
SANY (M) is an indirect 70%-owned subsidiary of Sany Group Co. Ltd. SANY (M) is a company incorporated in Malaysia on 26 February 2016 and having its paid-up share capital of RM6,000,000.00 divided into 6,000,000 ordinary shares. SANY (M) is in the business of, inter alia, involving in designing architectural precast concrete, experience in precast concrete manufacturing process and installation procedures in construction of buildings in developments.
Sany Group Co Ltd (“SANY Group”) was incorporated in China in 1989. SANY Group’s one of core subsidiaries, Sany Heavy Industry Co Ltd (“Sany Heavy Industry”), was publicly listed on the Shanghai Stock Exchange on 3 July 2003. Sany Heavy Industry is a Chinese multinational heavy machinery manufacturing company headquartered in Changsha, Hunan Province. It is the sixth-largest heavy equipment manufacturer in the world, and the first in its industry in China to enter the FT Global 500 and the Forbes Global 2000 rankings.
Sany Heavy Industry supported by the strength of SANY Group in equipment manufacturing and the whole industry chain resources, has become a precast concrete expert in the industrialization of construction industry. Currently, Sany Heavy Industry is the largest provider for precast concrete equipment solutions in China, accounting for 50% market share.
The Parties agree the MOU shall serve as an interim agreement, which shall not be legally binding, recording the Parties’ initial commitment, responsibilities and understanding on the formation and purpose of the Newco pending the finalisation of a formal agreement to be executed by the Parties.
The Parties have to come to an understanding to form a joint venture entity in Malaysia to collaborate with each other to set up a precast concrete panel manufacturing facility and/or plant to produce, market, sell and to install the precast concrete products in housing and commercial development principally in Malaysia and such other relevant arrangement or business activities to be mutually agreed between the Parties from time to time.
The Parties agreed that the initial paid up capital for the Newco shall be RM4,000,000.00 and the Parties shall contribute to the paid up capital in accordance with their respective proportion of shareholdings as follows:
i) MLGLOBAL – 51%
ii) SANY (M) – 49%
MLGLOBAL’s obligation will be, principally but not limited to the promotion of the usage of precast concrete for its new and future construction projects with clients. MGB will also be sourcing for appropriate and relevant labour for the operation of the Newco.
SANY (M)’s obligation will be, principally but not limited to the transfer of technical know-how of all aspects of precast concrete to the Newco including the design, manufacturing, to the installation of precast concrete and the usage of precast concrete machineries. The Parties will use their best endeavour to mutually agree on all terms and conditions to conclude a formal agreement as soon as practicably possible.
The MOU shall serve as a platform for the MLGLOBAL Group to tap business opportunities and investment into IBS precast manufacturing business. This will improve MGB competitiveness in construction industry.
None of the Directors, substantial shareholders of MLGLOBAL and/or persons connected with them has any interest, direct or indirect, in the MOU。