20-05-2025
- Business
- New Straits Times
Sapura Industrial to set up RM18mil lithium component plant with China partner
KUALA LUMPUR: Sapura Industrial Bhd (SIB) has teamed up with a China-based firm to establish a precision component manufacturing plant in Malaysia with an initial investment of RM18 million.
In a filing with Bursa Malaysia, the group said its subsidiary, SIB Ventures Sdn Bhd, has entered into a binding heads of terms (HOT) with Zhejiang Zhongze Precision Technology Co Ltd (ZZ Tech) for the project.
The proposed joint venture will involve the formation of a new company, jointly owned by SIB Ventures and ZZ Tech, to serve international markets with precision structural components for lithium batteries.
Under the agreement, SIB Ventures will hold a 51 per cent stake in the joint venture company (JVC), while ZZ Tech will own the remaining 49 per cent.
The JVC will have a paid-up capital of RM18 million, to be funded by both parties in proportion to their shareholdings.
SIB said the move is part of its broader diversification strategy into the energy storage and battery ecosystem, with a focus on export-oriented manufacturing.
"The JVC represents a strategic step in the SIB group's diversification and enhances our access to new market opportunities," the group said.
"It also reinforces our position as a trusted growth partner in Malaysia and the region," it added.
SIB Ventures will assist the JVC with corporate, licensing, environmental and regulatory matters, as well as in sourcing a location for the plant.
ZZ Tech, meanwhile, will provide machinery, technical expertise, training and customer support.
The board of directors of the JVC will comprise five members, with three to be appointed by SIB Ventures and two by ZZ Tech.
ZZ Tech, incorporated in China in 2016, is a manufacturer of lithium battery precision structural components.
SIB said the HOT is not expected to have any material impact on its earnings, net assets or gearing for the financial year ending Jan 31, 2026.
The investment will be funded through internally generated funds or bank borrowings.
"The board of directors of SIB is of the opinion that the HOT is in the best interest of the SIB group and aligns with its long-term strategic growth plans," it said.
