VS Industry bags RM326mil deal to make coffee brewers

VS INDUSTRY BHD MANAGING DIRECTOR GAN SEM YAM.

KUALA LUMPUR: Electronics manufacturing services (EMS) giant VS Industry Bhd has secured a three-year contract worth at least US$82mil (RM326.3mil) to design and make a new model of coffee brewers.

The company said in a statement to Bursa Malaysia that the new coffee brewer was the first fully designed model by its unit VS Plus Sdn Bhd for the existing customer, which was not named, and thus VS Plus had the exclusive manufacturing rights for the first 18 months.

Production for the customer -- described by VS Industry as “a well-known brand of personal beverage system company in North America with an annual turnover of a few billion US dollars” -- is scheduled to begin from January 2017.

“To have us fully design a coffee brewer for them demonstrates the level of confidence and trust they have in our capability and quality,” VS industry managing director Datuk SY Gan said.

“At VS Industry, we are increasingly moving up the value chain to be the ODM (original design manufacturer) producer instead of just being an OEM (original equipment manufacturer) producer. This helps to forge a stronger bond with our customers.”

The customer has undertaken to purchase minimum orders of US$82mil over the next three years, said VS Industry, which is believed to be the largest EMS provider in Malaysia.

This latest deal came less than a month since VS Industry acquired a 20% stake in NEP Holdings (M) Bhd for RM60mil, which gave it RM100mil worth of annual committed orders to make Diamond water filters.

VS Industry shares shed 1 sen to close at RM1.43 on Tuesday, with 4.02 million shares traded.