This article first appeared in The Edge Financial Daily on June 18, 2019

KUALA LUMPUR: ARB Bhd, a wood product manufacturer which diversified into information technology (IT) a year ago, has teamed up with a Cambodian firm to implement the enterprise resource planning (ERP) system and solutions in that country.

The group’s wholly-owned subsidiary ARB Development Sdn Bhd (ARBD) yesterday signed a memorandum of understanding (MoU) with East Insurance PLC for the project valued at no less than US$20 million (RM83.6 million).

East Insurance, incorporated in 2017, is principally involved in the provision of general and life insurance in Canada.

“The MoU shall mark the company’s maiden foray into Cambodia market by leveraging on its expertise in provision of ERP system to East Insurance and also serves as a platform for ARBD to penetrate and expand its regional expansion in Southeast Asian countries, which is in line with the company’s business strategy,” ARB said in a statement.

ARB, previously known as Aturmaju Resources Bhd, said the MoU is valid for six months and expected to contribute positively to the group’s future earnings.

Under the terms of the MoU, ARBD and East Insurance will collaborate in developing and implementing the ERP system in the insurance operation platform for East Insurance in Cambodia. In additions, East Insurance is willing to outsource the IT management project to ARBD.

“Our entry into the Cambodian market marks another significant milestone for our ERP business, as we continue to pursue growth in line with our strategy to expand our portfolio and geographical presence. Our collaboration with East Insurance demonstrates the trust and recognition for our ERP and IT capabilities and technical skills,” said ARB chief executive officer (investment & technology) Datuk Larry Liew Kok Leong.

“This venture is part of ARB’s three-year international expansion road map, and we intend to grow our portfolio via similar collaborations. It is the board’s vision to increase the overseas revenue stream to reduce reliance on a single market,” he added.

ARB shares fell half a sen or 1.12% to close at 44 sen yesterday, giving the group a market capitalisation of RM55.95 million. For the past year, the counter has gained 225.93%.