KUALA LUMPUR (April 17): WTEC Group Bhd (KL:WTEC), a foam and fabric products maker, plans to buy a detached factory with office property in Semenyih, Selangor, as part of its manufacturing operation consolidation plan.

The group inked a letter of offer on Friday to purchase the asset from Athens Park Machineries Sdn Bhd for RM10.8 million, according to a bourse filing.

The move is in line with its plan to consolidate some of its existing manufacturing operations from its existing four facilities into one new factory, said WTEC.

“To support this plan, the company proposes to acquire a fully constructed, ready-built factory located in Kajang, Selangor, or Semenyih, Selangor.

“This plan is expected to enable more efficient management of the company’s manufacturing and quality control, while reducing transportation costs and shortening processes and production lead times,” it added.

The property purchase will be satisfied via funds raised from its initial public offering, internally generated funds and/or bank borrowings.

Athens Park Machineries is equally owned by Ho Zee Kim, Kuan Mun Chyi and Soo Sun Phui, according to WTEC. A tentative target completion date for the proposed acquisition was not disclosed in the filing.

Shares in WTEC ended down half a sen or 3.85% at 12.5 sen, valuing the company at RM60 million. The counter is down 50% against its 25 sen listing price in April last year.