KUALA LUMPUR: Asia Poly Holdings Bhd
strengthened its raw material supply while advancing sustainability in September 2024 by subscribing to new shares for a 35% equity stake in EcoGreen Monomer Sdn Bhd (formerly known as Zhen Xing Plastic Sdn Bhd) for RM7.5mil in cash.
EcoGreen is in the business of producing depolymerized methyl methacrylate monomer (green MMA). MMA is the raw material used to manufacture acrylic plastics – it can be the form of virgin MMA that is derived from petrochemical processes; or green MMA where it is produced from recycling used or waste acrylic products.
The original shareholders of EcoGreen, Huang Yongkang and Hua Su Acrylic Material Pte Ltd (a company related to Huang), hold the balance stakes of 15% and 50%, respectively.
“EcoGreen is our existing supplier, and from what we know, they are the only producer of green MMA in Southeast Asia. So, when we got to know they are looking for a strategic partner to strengthen their existing operations and to grow new markets, we said yes immediately,” said Asia Poly chairman Dato’ Yeo Boon Leong.
Having EcoGreen as an associate company enables Asia Poly to have a secured and stable supply of green MMA, while aligning perfectly with the latter’s commitment to enhancing sustainability in every aspect of its business.
“We see tremendous growth potential for eco-friendly acrylic sheets like our a-castGreen, reflecting broader worldwide trends towards sustainability and eco-friendly materials. This is especially true in the Western countries like the US and Europe where we currently export to,” said Yeo.
He added EcoGreen has existing supply contracts on-hand, a ready off-taker in China, as well as equipment capable of handling a wide range of waste types as feedstock.
Huang, meanwhile, has expertise and deep knowledge in the production of green MMA. The only missing piece in the past was sufficient working capital to run the business efficiently. With the entry of Asia Poly, the puzzle is now completed.
This is evident in the turnaround of EcoGreen’s financial performance. According to Yeo, EcoGreen was in the red earlier but with the capital injection from Asia Poly (via the share subscription), it is now producing about 1,250 tonnes of green MMA per month and has turned profitable.
“EcoGreen’s factory in Senawang, Negeri Sembilan, is currently operating at 50% capacity based on 12 hours a day. We have room to increase this by another 50% by year end and the monthly capacity of the plant is about 2,500 tonnes,” said Yeo.
Looking forward, Yeo is optimistic about the future of Asia Poly despite the group’s recent financial challenges.
