Asia Bioenergy works with Vsolar to develop technology for food crops plantation

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KUALA LUMPUR (June 15): Asia Bioenergy Technologies Bhd’s wholly-owned subsidiary, Artisan Semesta Sdn Bhd (ASSB) has entered into a collaboration and alliance agreement (C&A agreement) with Vsolar Group Bhd’s wholly-owned unit, Solar Interactive Sdn Bhd (SISB), to plant and intercrop food crops.

According to its filing to the Bursa Malaysia, Asia Bioenergy (fundamental: 0.6; valuation: 0.3) said the project will utilise ASSB’s effective micro-organisms (EM) products at SISB’s photovoltaic energy generation sites.

The planting of the food crops will utilise, but will not limit itself to, organic hydroponic planting technologies. These advanced organic hydroponic technologies will be jointly developed by ASSB and SISB, it added.

SISB is principally engaged in photovoltaic energy generation.

According to the filing, the agreement serves as an understanding that the parties shall collaborate exclusively to develop the space made available by SISB, and to utilise ASSB’s EM products for the planting and production of the identified food crops.

The company said the project costs and detailed investment terms of each available site, shall be determined on a case to case basis, mutually between the parties.

“The term of the C&A agreement is for a period of three years, commencing on the date of the C&A agreement, unless otherwise mutually extended or terminated.

It added that either party may terminate the C&A agreement upon delivery of written notice, at least 90 days prior to such termination. Each party shall bear its own costs resulting from or related to the termination.

“The C&A agreement is expected to contribute positively to AsiaBio Group’s prospects in the medium term. However, the signing of this C&A agreement will not have any immediate effect on the earnings, net assets, share capital and shareholdings structure of AsiaBio.

“The company does not foresee any exceptional risk, other than the normal operational risk associated with the signing of this C&A agreement,” it added.

Asia Bioenergy’s share price went down 0.5 sen or 6.67% to close at 0.7 sen today, giving it a market capitalisation of RM65 million.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)