Ramunia and Mackra in Tubular Rolling Plant JV
Ramunia and Mackra Pte Ltd have entered into a Memorandum of Understanding for a Joint Venture Agreement to incorporate a new company in Malaysia ("NEW CO") for the purpose of setting up and managing a tubular rolling facility in Malaysia to cater to the local and Southeast Asia markets.
Mackra Pte Ltd is a private limited liability company incorporated in Singapore on November 20, 2006. MPL is an investment holding company specially incorporated to venture into tubular rolling business. MPL has entered into a Technical Collaboration Agreement with Sam Kang Industries Co. Ltd for technical support to establish the tubular services. Sam Kang is incorporated in Korea in 1996 and is involved in production and supply of heavy wall rolled steel tubular.
The MOU records both parties' understanding relating to the joint-venture development based on the purpose of setting up and managing a tubular rolling facility in Teluk Ramunia, Johor, Malaysia, to cater for the Malaysian oil and gas and other heavy engineering industries and South East Asia market for steel tubular.
The salient features of the MOU are as follows:
- The Joint Venture Company ("JVCo") shall be incorporated in Malaysia with a name to be mutually agreed upon, subject to the approval of the relevant authorities.
- The estimated investment outlay for the tubular facility is approximately US $15 million.
- Ramunia and MPL will each subscribe for 70% and 30% respectively of the initial issued and paid up share capital of JVCo.
- The joint venture agreement shall be finalized and executed within three (3) months from the date of the MOU unless such period is extended by mutual agreement of the parties.
The prospect of the tubular rolling facility is positive in view of the strong demand for rolled tubular in Southeast Asia and Malaysia. The increase in the activities of the oil and gas industries and the expected demand from the oil majors and the local fabrication industry is expected to be sustainable and robust.
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