KUALA LUMPUR (Sept 17): Pipes and fittings maker Resintech Bhd (KL:RESINTC) on Tuesday said it is forming a joint venture (JV) with a unit of a Sarawak state agency to jointly trade industrial plastic products in the state.

The JV will boost Resintech’s trading capabilities and open doors to new opportunities in Sarawak’s rapidly growing industrial sector, the company said in a statement. The JV will also provide a steady revenue stream from the Sarawak market, Resintech said.

“The JV will initially focus on trading industrial plastics products, with the possibility of expanding into manufacturing based on future market demands,” it said.

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SEDC Energy Sdn Bhd, a unit of Sarawak Economic Development Corp, has agreed to subscribe to 40,000 new shares in the JV, Resintech said in an exchange filing. Once completed, SEDC Energy will own 40% in Johan Intan Sdn Bhd while Resintech will have the remaining 60%.

Johan Intan is currently Resintech’s fully owned subsidiary.

The latest agreement follows the memorandum of understanding signed between Resintech and SEDC Energy in June last year, initially to leverage each other's strengths and resources to operate in the plastic industry.

“The board believes that the proposed JV will provide opportunities for the company to strengthen its financial performance, explore new business opportunities and increase market share in Sarawak,” Resintech said in the filing.

Last week, Resintech also announced its JV with construction and engineering firm CNH Group Sdn Bhd for a proposed hostel development in Kuala Langat, Selangor, with an estimated gross development value of RM34.1 million.

Both companies are set to jointly develop the mixed development on part of a land measuring some 4.6 acres that Resintech's unit Johan Panglima (M) Sdn Bhd bought in 2021 for RM23.54 million.

At the time of writing, shares of Resintech were up one sen or 1.6% to 62.5 sen, giving the company a market capitalisation of RM122 million following the announcement. 

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