Broadcom sets up warehouse in Malaysia, plans RM4.1b investment

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KUALA LUMPUR (Sept 19): American semiconductor player Broadcom Ltd, which has set up its global distribution warehouse in the Batu Kawan Industrial Park in Penang, plans to spend RM4.1 billion over the next 10 years to expand its business here further.

This investment, according to Minister of International Trade and Industry Datuk Seri Mustapa Mohamed in a statement today, will be spent on, among others, areas like global production planning, quality management, strategic procurement and logistics management.

As for the new facility it has set up in Batu Kawan, Mustapa said Broadcom's global inventory for products being manufactured in the US, Taiwan, South Korea, Thailand and Malaysia will be centrally stored right here before being distributed worldwide.

"This new facility is undeniably a welcome boost to Malaysia's logistics industry. Given that 90% of its products will be exported via air freight, it would increase the usage of Malaysia's airport facility with approximately 300 to 500 million units of products being shipped per week.

"In fact, Broadcom's estimated future export revenue is more than RM60 billion once its principal hub is fully operational, making Broadcom the largest E&E exporter in Malaysia," he said during the opening ceremony of Broadcom's global distribution warehouse today.

The facility will be managed by Broadcom's principal hub, he said, which will also support its global subsidiaries in undertaking research and development activities.

"This would further strengthen Malaysia's E&E ecosystem and create vast business opportunities for companies in supporting industries. Broadcom has certainly played an active role in supporting the local supply chain, benefitting contract manufacturers," said the minister.

According to the Malaysian Investment Development Authority (MIDA), Malaysia has, over the last decade, achieved significant progress in the electrical & electronics (E&E) industry that resulted in the growth of new businesses and creation of jobs.

The country, it added, is now the world's seventh largest exporter of E&E products with a total export of RM287.7 billion last year.