KUALA LUMPUR (Aug 18): Genting Plantations Bhd (KL:GENP), which is 54%-owned by Genting Bhd (KL:GENTING), is planning to venture into the vegetable seeds business by partnering China-based Shouguang Vegetable Science and Technology Sdn Bhd (SVST).
The collaboration will involve setting up two joint venture (JV) companies — of which 60% will be held by Genting Plantations' indirect wholly-owned unit, AGCT Vegetable AgVentures Sdn Bhd, with the balance 40% being held by SVST. The JV companies will develop a 70-acre plot of land in Kulai, Johor, into a centre for excellence for tropical vegetable crops, and undertake a vegetable seeding programme.
The seed breeding programme involves the setting up of research and development facilities. There will also be a showcase centre for agricultural technology and innovation, greenhouses for food and vegetable production, and a processing plant for the import and export of agricultural products and inputs, according to Genting Plantations' bourse filing on Monday.
Both JV companies will have an initial share capital of RM1,000 each. The planned investment will later be raised to a total of RM525 million.
"This diversification will enhance Genting Plantations' business resilience and seeks to unlock new revenue streams in vegetable crops, beyond oil palm," the filing read.
Genting Plantations plans to fund the venture with internal funds and/or bank borrowings. The JV is targeted for completion in the first quarter of 2026.
SVST is wholly-owned by Shouguang Vegetables (Guangzhou) Agriculture Technology Co Ltd, which in turn is an indirect wholly-owned unit of Shandong Shouguang Vegetable Industry Group Co Ltd.
Shandong Shouguang is a vertically integrated agricultural enterprise covering the entire vegetable value chain — from seed R&D, seedling propagation and greenhouse cultivation to processing, logistics, e-commerce, wholesale and food manufacturing, Genting Plantations noted.
"By leveraging Shandong Shouguang's end-to-end expertise combined with Genting Plantations' market presence, the proposed joint venture is expected to unlock new business verticals as well as generate future synergies," Genting Plantations added.
Shares of Genting Plantations closed three sen or 0.60% lower at RM4.95 on Monday, giving it a market capitalisation of RM4.44 billion. The stock has fallen more than 15% year to date.