KPS-MORPHING INTO THE SULTAN OF WATER

According to Rachael Kam of THE STAR, a German-based chemical company has bought a stake in local water treatment company, Chemindus Sdn Bhd.

Sud-Chemie AG, a listed company in Germany, has not only acquired a 55% stake in Chemindus but it has also bought the company’s technology for the manufacture of specialties coagulants which are used in water treatment plants. Hydrovest Sdn Bhd, a subsidiary of Kumpulan Perangsang Selangor Bhd owns 25% of Chemindus Sdn Bhd while founder and Managing Director Tan Swee Hua now holds the balance of 20%.

Established in 1992, Chemindus produces aluminium-based coagulants and supplies the water treatment chemicals to the local market and those abroad. The company’s laboratory is equipped with high-tech analytical equipment. Chemindus’s vision is to be the leader in water treatment technology. Its chemicals are versatile and good to remove water impurities. It is setting its eyes currently on the rapidly growing market for potable water and industrial effluents treatment in South-East Asia.

For Sud-Chemie AG, buying into Chemindus has given it access to a promising market for water treatment chemicals in Malaysia, and this represents a part of the ongoing expansion of its water treatment business in South-East Asia.

Tan, foresees good prospects for Chemindus because Sud-Chemie would bring in innovative technology and operational techniques as well as provide high-tech water treatment solutions. The enlarged entity, resources and various technologies from Germany would allow the company to expand to areas that it is not involved in currently. Chemindus aims to grow at a fast pace to become South-East Asia's biggest water treatment supplier in three to five years.

Water treatment and wastewater management will remain the core business of Chemindus. Its polyaluminium chloride-based coagulants have captured a market share of over 50% locally. Following the increase in water consumption, the demand for new water treatment chemicals is also rising.

Chemindus is poised to grab a bigger market share. Tan said the market for treated potable water supply in the region would continue to grow, because in certain countries, treated water supply is still limited. Secondly, the demand for premium quality treated water supply will continue to grow.

Tan informed that the company intends to build another plant by year-end and Selangor would be ideal if the State Economic Development Corp has available land bank for the plant. Other sites under consideration are in Penang, Perak or Johor.

A graduate of the University of Malaya, Tan started the business together with his former lecturer, Professor Dr Chan Chee Yan, who is Chemindus technical advisor. From a rented factory lot in 1992, the company now owns eight lots with a total built-up area of 40,000 sq ft. The plant has recently doubled its monthly production to 4,000 tonnes. Its products are exported to Indonesia, Thailand, Japan and South Africa. Currently, exports contribute a substantial amount to the company's revenue.

“With the new partner and expanded capacity, we will export to more countries and will set up operations in strategic countries in the region within the next few years,” he said.

Another feather in the cap of KPS. Looks like KPS is really targetting sultan status in the country’s water resource industry and perhaps beyond….

Syabas!

Heartsong