SHAH ALAM (June 29): Tasco Bhd expects its foray into the cold chain logistics segment to boost its 2017 (FY17) revenue by an additional RM100 million, following shareholder approval for its acquisition of Gold Cold Transport (GCT) and Westport land.
This will bring its revenue for the year to around RM700 million, said Tasco’s executive chairman Lee Check Poh after the group’s extraordinary general meeting here today.
GCT, which Tasco is buying for RM186.08 million cash, is expected to begin registering contribution once the acquisition is completed in July. Meanwhile, the acquisition of 39.52 acres of land in Pulau Indah for RM113.83 million will contribute to revenue by year-end, said Tasco’s managing director Freddie Lee Jew Kiat.
Synergies are expected to be gained by selling Tasco’s sea freight and air freight services to GCT, a combined consumer and industrial focus, and shared geographical markets, explained the company’s executive director Andy Lee, who is also the head of the supply chain solutions division.
According to Freddie, the current cold chain warehouse is running at full capacity and Tasco will look into building a second or third warehouse depending on specific customer demands.
“Our focus for the Westport land is to make it a regional hub. We would like to promote it to existing customers,” he said.
There was close to unanimous approval for both resolutions from shareholders for the two acquisitions.
Separately, the group will also be launching a new global distribution hub at the former LCCT site in Sepang that will include “pick-and-pack” facilities to cater to Renesas Electronics Corp, a Japanese semiconductor manufacturer, said Check Poh.
The opening ceremony for the site will be held next week and it will make Tasco the biggest warehouse operator in the area with a total of four warehouses, said Andy.
Shares in Tasco rose six sen or 2.52% to RM2.44 as the EGM commenced, giving the counter a market capitalisation of RM488 million. A total of 525,000 shares were traded by market close.