KUALA LUMPUR, May 30, 2011 – Boustead Defence Technologies Sdn Bhd (BDTSB) a subsidiary of Boustead Heavy Industries Corporation Berhad (BHIC) signed a joint venture (JV) and share holder agreement with Prokhas Manager Sdn Bhd (PMSB) to produce, market and sell propellant and related products for the defense sector.
Under the new joint venture company, Pyrotechnical Ordnance Malaysia Sdn Bhd (POMSB), PMSB and BDTSB will have a 51% and 49% stake respectively.
According to Tan Sri Dato’ Seri Ahmad Ramli Bin Haji Mohd Nor, Managing Director of BHIC, “POMSB will focus in producing double-base propellant for artillery propellant and rocket propellant. Propellant is a solid chemical based material used for propelling projectile from guns and firearms. At the initial stage, we target to supply to the Malaysian Armed Forces and subsequently we will market the products regionally.”
“In addition, we plan to enter into a technical support agreement with Science and Technology Research for Defence Institute (STRIDE) for technical assistance and evaluation purposes to maintain and enhance the quality of the propellants.” Tan Sri Ramli added.
“The partnership between BDTSB with PMSB will foster the growth of high-tech defence related production in Malaysia in line with the nation’s aspirations to strengthen the country’s defence technology industrial base while introducing new technology and export opportunities.” he concluded.
Upon its incorporation, the joint venture company will have an initial authorized share capital of RM50,000,000.00 divided into 50,000,000 ordinary shares of RM1.00 each. Following the completion of the joint venture agreement, the joint venture company will have a paid-up capital of RM35,294,120.00.
The joint venture is not expected to have any material effect on the consolidated earnings of the BHIC Group for the year ending 31 December 2011.
Boustead Heavy Industries Corporation Berhad is a subsidiary of Boustead Holdings Berhad, a conglomerate listed on the Main Board of Bursa Securities. Boustead Holdings Berhad is a subsidiary of the Armed Forces’ Funds (Lembaga Tabung Angkatan Tentera).
The Boustead Heavy Industries Group is involved in maritime, defence and heavy engineering activities, with shipyards located in Lumut, Pulau Pinang, Langkawi and Ghana.
Issued on behalf of: Boustead Heavy Industries Corp. Bhd.
By: acorn communications sdn bhd
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