KUALA LUMPUR: V.S. Industry Bhd (VSI) today inked a sale and purchase and construction agreements (SPCA) with Ipark Development Sdn Bhd (IDSB), a subsidiary of AME Elite Consortium Bhd (AEC), to acquire 6 pieces of land with industrial buildings in Senai, Johor for RM98.8 million.
The land is located within a comprehensive development known as Senai Airport City where IDSB is the registered and beneficial proprietor of the lands measuring approximately 76.6 acres in Mukim of Tebrau, Johor Bahru, and Mukim of Senai, Kulai, Johor.
IDSB has also obtained the planning approval to develop the land as an industrial estate named i-Park@Senai Airport City.
VSI managing director Datuk SY Gan said the acquisition of land and buildings will boost our built-up area by about 25 per cent.
"It enables us to continue growing the business as our current manufacturing capacity are already taken up.
"The timing couldn't be better as we secured yet another new customer from the US and this comes hot on the heels of us clinching Victory Innovations as our key customer in August 2020.
"We will be producing home appliances for this new customer at the buildings bought under the acquisition next year," he said in a statement today.
Gan said the group will also be relocating its headquarter to the properties in Senai, which will free up space at the existing manufacturing facilities to capture the rising orders from existing customers.
"Furthermore, the properties in Senai are strategically located within close proximity with our existing facilities, which allows us to expand our capacity while at the same time, maintain close management control on our existing operations, therefore enhancing overall operational synergies and efficiency," Gan said.
According to an industry trend report by the Global Market Insights, the electronics manufacturing services (EMS) market size exceeded US$500 billion in 2019 and is expected to continue growing at a compounded annual growth rate (CAGR) of 5 per cent globally between 2020 and 2026.
The Asia Pacific region, however, is projected to grow at a faster CAGR rate of 8 per cent.
"One of the reasons for the faster growth rate is attributed to the on-going trade dispute between the US and China, which has opened up many opportunities for electronics manufacturing services (EMS) players in the Southeast Asia.
"The Group has thus far successfully clinched several new customers as a result of the trade war, resulting in our existing capacities being fully filled.
"We look forward to moving into our new headquarter at i-Park @ Senai Airport City, an integrated, gated and guarded industrial park by AEC.
"Recognized as a sustainable industrial development, the concept embraces clean and green atmosphere which is aligned with our focus to be a responsible corporate citizen with sustainability instilled into our way of business," Gan said.
The acquisition is expected to be completed by 30th June 2021.
